Amendment of soil with biochar has been widely investigated for soil quality improvement in terms of biotic and abiotic functionalities. The performance of biochar-based amendment varies according to the site characteristics, biochar properties, and soil management targets. There is no existing review that summarizes a broad range of performance indicators to evaluate the health of biochar-amended soil. Based on the latest studies on soil amendment with biochar, this review critically analyzes the soil health indicators that reveal the potential impact of biochar amendment with respect to physicochemical properties, biological properties, and overall soil quality. It is found that soil pH, soil aggregate stability, and soil organic matter are the basic indicators that could influence most of the soil functions, which should be prioritized for measurement. Relevant functional indicators (e.g., erosion rate, crop productivity, and ecotoxicity) should be selected based on the soil management targets of biochar application in agricultural soils. With this review, it is expected that target-oriented performance indicators can be selected in future studies for field-relevant evaluation of soil amendment by biochar under different situations. Therefore, a more cost-effective and purpose-driven assessment protocol for biochar-amended soils can be devised by using relevant measurable attributes suggested in this review.