Chitin, the second most abundant biopolymer, possesses diverse applications in the food, agricultural, and pharmaceutical industries due to its functional properties. However, the potential applications of chitin are limited owing to its high crystallinity and low solubility. N-acetyl chitooligosaccharides and lacto-N-triose II, the two types of GlcNAc-based oligosaccharides, can be obtained from chitin by enzymatic methods. With their lower molecular weights and improved solubility, these two types of GlcNAc-based oligosaccharides display more various beneficial health effects when compared to chitin. Among their abilities, they have exhibited antioxidant, anti-inflammatory, anti-tumor, antimicrobial, and plant elicitor activities as well as immunomodulatory and prebiotic effects, which suggests they have the potential to be utilized as food additives, functional daily supplements, drug precursors, elicitors for plants, and prebiotics. This review comprehensively covers the enzymatic methods used for the two types of GlcNAc-based oligosaccharides production from chitin by chitinolytic enzymes. Moreover, current advances in the structural characterization and biological activities of these two types of GlcNAc-based oligosaccharides are summarized in the review. We also highlight current problems in the production of these oligosaccharides and trends in their development, aiming to offer some directions for producing functional oligosaccharides from chitin.