A highly efficient method was developed for preparing chitosan-lignin wood adhesives with high performance using chitosan and ammonium lignosulfonate as main raw material and performance of the resulting adhesives was evaluated by manufacturing medium density fiberboard (MDF). The effects of chitosan-lignin adhesive content and lignin/chitosan weight ratio on the physical and mechanical properties of MDF and the optimal method to prepare and utilize chitosan-lignin wood adhesives were investigated. The results indicated that chitosan had important effects on bonding strength and water resistance and the performance of chitosan-lignin adhesive improved significantly with the optimal method: chitosan-lignin adhesive content of 6% and lignin/chitosan weight ratio of 1:2. The fractures in the bonded joints and the chitosan-lignin adhesive were analyzed via scanning electron microscopy (SEM), Fourier transform infrared spectroscopy (FTIR) and thermogravimetric analysis (TGA). The SEM image analysis verified the high performance of the chitosan-lignin adhesive. The FTIR analysis indicated that interactions due to hydrogen bonding between chitosan and lignin occurred. The results of thermal stability analysis validated this and showed that the thermal stability of the interactions was not high.