Psidium (Myrtaceae) comprises approximately 266 species, distributed in tropical and subtropical regions of the world. Psidium taxa have great ecological, economic, and medicinal relevance due to their essential oils’ chemical diversity and biological potential. This review reports 18 Psidium species growing around the world and the chemical and biological properties of their essential oils. Chemically, 110 oil records are reported with significant variability of volatile constituents, according to their seasonality and collection sites. Monoterpenes and sesquiterpenes with acyclic (C10 and C15), p-menthane, pinane, bisabolane, germacrane, caryophyllane, cadinane, and aromadendrane skeleton-types, were the primary constituents. The essential oils showed various biological activities, including antioxidant, antifungal, antibacterial, phytotoxic, larvicidal, anti-inflammatory, and cytotoxic properties. This review contributes to the Psidium species rational and economic exploration as natural sources to produce new drugs.