Abstract Background Prehydrolyzate, which is from the prehydrolysis process in dissolving pulps industry, contains various sugar-derived and lignin compounds such as xylooligosaccharides (XOS), gluco-oligosaccharides, xylose, glucose, and soluble lignin (S-L). The XOS has several beneficial effects on human physiology. XOS and S-L in prehydrolyzate are difficult to efficiently fractionate due to their similar molecular weights and water solubility. In this work, we proposed a sustainable and green process using polystyrene divinylbenzene (PS-DVB) resin to simultaneously separate and recover XOS and S-L. Enzymatic hydrolysis with endo-1,4-β-xylanase and fermentation with P. stipites were sequentially applied to purify XOS to minimize xylose content as well as amplify contents of xylobiose and xylotriose. In addition, 2D-HSQC NMR was used to analyze the structural characteristics of XOS and S-L. Furthermore, the biological abilities of antioxidants and prebiotics of these fractions were investigated by scavenging radicals and cultivating intestinally beneficial bacterias, respectively. Results Results showed that PS-DVB resin could simultaneously separate XOS and solubilized lignin with excellent yields of 93.2% and 85.3%, respectively. The obtained XOS after being purified by enzymatic hydrolysis and fermentation contained 57.7% of xylobiose and xylotriose. 10.4% amount of inherent xylan was found in the S-L fraction obtained by PS-DVB resin separation. 2D-HSQC NMR revealed that lignin carbohydrate complexes existed in both XOS and S-L as covalent linkages between lignin and 4-O-methylglucuronoarabinoxylan. The biological application results showed that the antioxidant capacity of S-L was stronger than XOS, while XOS was superior in promoting growth of intestinal Bifidobacteria adolescentis and stimulating production of short-chain fatty acids by Lactobacillus acidophilus. Conclusions The proposed strategy of sequentially combining hydrophobic resin separation, enzymatic hydrolysis, and fermentation was successfully demonstrated and resulted in simultaneous production of high-quality XOS and solubilized lignin. These biomass-derived products in prehydrolyzate can be regarded as value-adding prebiotics and antioxidants.