Kraft lignin (KL) was valorized by introducing phenolic hydroxyl groups and adjusting the molecular weight by oxidative depolymerization. Hydrogen peroxide with copper sulfate as a catalyst was employed in this process. The depolymerized lignin (DL) was characterized with differential ultraviolet spectrum (UV), Fourier transform infrared (FT-IR) spectrometry, gel permeation chromatography (GPC), and heteronuclear single quantum correlation (HSQC) spectra. Both the molecular weight (Mw and Mn) and the polydispersity of the depolymerized lignin decreased compared with default kraft lignin. The content of phenolic hydroxyl groups increased from 1.55 to 2.66 mmol/g. The depolymerized lignin was used in the synthesis of lignin-phenol-formaldehyde (LPF) resin as a substitution of phenol. The physical properties including viscosity, bonding strength, and free formaldehyde content of the adhesive met the GB/T 14704-2006 standard with the substitution of 50% phenol with DL.