Over the last few decades, innovative wood composite products and processes have created markets for new and existing products. Inorganic bonded fibre composites have been developed for high performance applications using conventional cement and concrete. The demands for wood based composites along with increasing economic and environmental concerns on conventional wood products necessitate moving beyond the traditional processing methods to more cost-effective and environmentally friendly approaches. In the wake of the twenty-first century, a fast-setting phosphate binder with a low carbon footprint was developed, which can alternatively be utilized in wood composite development. This paper reviews the recent progress in phosphate bonded composite products, based on published literature from the last two decades. A brief background on Portland cement based natural fibre composites is presented. In addition, the mechanism of the formulation of phosphate binders, the effect of aggregates in the materials and the environmental benefits accruable to such materials are discussed.