The increasing generation of sewage sludge and the demand for more sustainable waste management have shifted attention from conventional disposal towards resource recovery and sludge valorization. Sewage sludge contains substantial amounts of organic matter, nutrients and mineral components that can be recovered as energy, fertilizers and value-added materials. However, the presence of heavy metals, pharmaceuticals, per- and polyfluoroalkyl substances (PFAS), microplastics and other contaminants may constrain the safe application of recovered products and influence the overall environmental performance of valorization processes. This critical review evaluates current and emerging pathways for sewage sludge valorization, focusing on energy recovery, nutrient recovery, carbon-based products, mineral and material recovery, and integrated sludge biorefinery concepts. The pathways are assessed in terms of resource recovery potential, product characteristics, energy and chemical requirements, contaminant fate, residual streams and technological maturity. Particular attention is given to the distinction between contaminant removal and destruction and to the potential transfer, transformation or concentration of contaminants during sludge processing. The analysis indicates that no single valorization pathway can be considered universally sustainable, as its environmental performance depends on sludge characteristics, process conditions, target products and residua stream management. Integrated approaches combining energy, nutrient and material recovery may provide greater resource efficiency, provided that contaminant fate and product quality are adequately controlled. Future development should therefore prioritize simultaneous assessment of resource recovery efficiency, product quality, contaminant behavior and overall environmental performance rather than focusing on recovery yields alone.