Chinese herbal medicine (CHM) is often used as dietary supplements to maintain good health in animals and humans. Here, we review the current knowledge about effects of CHM (including ultra-fine Chinese herbal powder, Acanthopanax senticosus extracts, Astragalus polysaccharide, and glycyrrhetinic acid) as dietary additives on physiological and biochemical parameters in pigs, chickens and rodents. Additionally, we propose possible mechanisms for the beneficial effects of CHM on the animals. These mechanisms include (a) increased digestion and absorption of dietary amino acids; (b) altered catabolism of amino acids in the small intestine and other tissues; (c) enhanced synthesis of functional amino acids (e.g., arginine, glutamine and proline) and polyamines; and (d) improved metabolic control of nutrient utilization through cell signaling. Notably, some phytochemicals and glucocorticoids share similarities in structure and physiological actions. New research findings provide a scientific and clinical basis for the use of CHM to improve well-being in livestock species and poultry, while enhancing the efficiency of protein accretion. Results obtained from animal studies also have important implications for human nutrition and health.