Effective separation methods must be developed before bio-oils become a source of chemical products or liquid fuels by further upgrading. Phase separation is one effective pathway to realize an initial isolation of bio-oils. When aqueous salt solutions are added, phase separation of the pyrolysis bio-oil can occur to form two different phases: the upper layer with high contents of water, acetic acid, and water-soluble compounds and the bottom layers with low water content and high lignin pyrolysis compounds [Song, Q-H.; Nie, J.-Q; Ren, M.-G.; Guo, Q-X Effective phase separation of biomass pyrolysis oils by adding aqueous salt solutions. Energy Fuels 2009, 23 (6), 3307-3312]. In this paper, the salt-induced phase separation of bio-oils with 20 kinds of salt solutions was investigated. On the basis of the dependence of the mass ratio of the bio-oil bottom layer to the whole bio-oil sample upon the salt solution concentrations, it has been demonstrated that the phase separation derives from a normal ionic strength effect as well as chemical properties for some metal ions. Solvent fractionations of the two-phase bio-oils were performed, and fractions were characterized by elemental and gas chromatography/mass spectrometry (GC/MS) analyses. Among the four bottom-layer bio-oil fractions, fraction A contains insoluble macromolecular substances, such as cellulose, and fractions, B, C, and D are mainly phenolic compounds. Furthermore, O-methylation of the mixtures of fractions B, C, and D with dimethyl carbonate (DMC) has been performed in ionic liquid [Bmin] Cl, and the reaction is highly effective and recyclable for the ionic liquid. The modified mixture of the fractions reveals a large elevation in the heating value.