In the recent development of Humanistic Buddhism, “Buddhist Psychology” has been developing gradually. In fact, the interdisciplinary conversation between “Buddhism” and “Psychology” has started long ago. During the Late Qing and Early Republic era, Master Taixu and Liang Qichao had already been giving lectures about Buddhist Psychology. Since then, the development of Buddhist Psychology has never stopped. On the professional level, Buddhist psychology has been developed as a specialized academic subject, with students in graduate school working on their thesis in this area. On the societal level, quite a number of books are written for the mass society which focused on self-development and stress management. It is noticeable that Buddhist psychology is increasingly important on both academic and societal levels. Although Buddhist psychology has such a strong influence nowadays, there is still no systematic review about its development at this moment. Despite its fast pace development, there are some underlying worries in this academic field. In the present researches and publications, it is common to see that quite a number of the researchers are strong in Buddhist philosophy but relatively weak in psychology, the methodology of social science is not yet fully utilized. This article intended to review the present situation of Buddhist psychology, and discuss how a true interdisciplinary integration between Buddhism and psychology can be achieved. The conclusion of this article proposed the establishment of a new stream “Practical Buddhist Psychology” which meets the spirit of Humanistic Buddhism.