Recycling of spent lithium-ion batteries (LIBs) has attracted significant attention in recent years due to the increasing demand for corresponding critical metals/materials and growing pressure on the environmental impact of solid waste disposal. A range of investigations have been carried out for recycling spent LIBs to obtain either battery materials or individual compounds. For the effective recovery of materials to be enhanced, physical pretreatment is usually applied to obtain different streams of waste materials ensuring efficient separation for further processing. Subsequently, a metallurgical process is used to extract metals or separate impurities from a specific waste stream so that the recycled materials or compounds can be further prepared by incorporating principles of materials engineering. In this review, the current status of spent LIB recycling is summarized in light of the whole recycling process, especially focusing on the hydrometallurgy. In addition to understanding different hydrometallurgical technologies including acidic leaching, alkaline leaching, chemical precipitation, and solvent extraction, the existing challenges for process optimization during the recycling are critically analyzed. Moreover, the energy consumption of different processes is evaluated and discussed. It is expected that this research could provide a guideline for improving spent LIB recycling, and this topic can be further stimulated for industrial realization.