In Traditional Chinese Medicine (TCM), Chai Hu belongs to the 'Cool/Acrid herbs that release the Exterior' category. Herbs that release the Exterior aim to to treat the early stages of diseases that affect the upper respiratory tract, the eyes, the ears, the nose, the throat or the skin. TCM believes that External diseases such as colds or allergies can only invade the body if the External environment overwhelms our Wei Qi (the TCM version of the immune system). In order to counteract this invasion Cool/Acrid herbs aim to induce sweating by dilating our capillary pores so that they release more sweat. The belief is that this will expel the disease from the body and stop it from invading further.

As suggested by its category Chai Hu is Cool in nature. This means that Chai Hu tends to help people who have too much 'Heat' in their body, although with less effect than a plant that would be Cold in nature. Balance between Yin and Yang is a key health concept in TCM. Those who have too much Heat in their body are said to either have a Yang Excess (because Yang is Hot in nature) or a Yin deficiency (Yin is Cold in Nature). Depending on your condition Chai Hu can help restore a harmonious balance between Yin and Yang.

Chai Hu also tastes Bitter. The so-called 'Five Phases' theory in Chinese Medicine states that the taste of TCM ingredients is a key determinant of their action in the body. Bitter ingredients like Chai Hu tends to have a cleansing action on the body by clearing Heat, drying Dampness and promoting elimination via urination or bowel movements.

The tastes of ingredients in TCM also determine what Organs and Meridians they target. As such Chai Hu is thought to target the Gallbladder and the Liver. Similar to modern medicine, in TCM the Gallbladder stores and releases bile produced by the Liver. It also controls the emotion of decisiveness. The Liver on the other hand is often referred as the body's "general" because it is in charge of regulating the movements of Qi and the Body Fluids. It also takes a leading role in balancing our emotions.