The catalytic conversion of alkali lignin to chemicals has been the subject of intense research efforts during the past few decades. In this study, VS2 catalysts, with different morphologies of sheets and nanoflowers, were prepared through hydrothermal methods and applied to the hydrogenation of alkali lignin. The conversion of alkali lignin and yield of bio-oil are 77.02 and 58.75%, respectively, at 250 °C under 2 MPa H2 for 1.5 h with a VS2 sheets catalyst, which is higher than that of a flower-like VS2 catalyst. It was found that mainly the components of bio-oil were phenols, important and useful chemicals in transportation fuels and chemical industries. Our results indicated that the prepared VS2 catalyst can be used as an effective material for degrading biomass to obtain valuable chemicals.