Small peptides are the ideal material to construct artificial enzymes due to their advantages of high similarity to natural enzymes and controllable structure. Small peptides have more simple structures which makes them convenient for rational design. Meanwhile, the diversity of amino acids arrangement, self-assembly characteristics of the sequence, the stability of the nanostructure, and good biocompatibility make it possible to construct high-efficiency catalytic active peptide-based artificial enzymes with broad application prospects. There are many advantages to using peptide-based materials for rationally designing active sites to construct artificial enzymes. (1) The amino acid sequences can be derived directly from the active sites in the natural enzyme, therefore preserving the function of enzymes but reducing much of the complexity that is inherent to nature enzymes; (2) Various active sites with specific structures and functions can be embedded in the peptide sequence, which is convenient for the artificial rational design of the artificial enzymes. (3) Peptides have good biocompatibility and hydrolysis reaction under mild conditions. According to the different catalytic degradation of the chemical bond, the peptide-based artificial hydrolases are mainly divided into the following categories: catalytic ester bond degradation peptide-based artificial enzyme, catalytic peptide bond degradation peptide-based artificial enzyme, catalytic glycosidic bond degradation peptide-based artificial enzyme. Therefore, this review mainly summarizes the peptide-based artificial hydrolase from activity origin, construction methods, microstructure, catalytic reaction type, catalytic influencing factors, activity improvement methods, activity mechanism, and future application. To promote the designing of peptide-based artificial enzymes with more efficient catalytic activity, accelerate the development and practical application of peptide-based artificial hydrolase.