Sewage sludge and red mud, as common industrial waste, have become a research hotspot in the field of achieving carbon peaking and carbon neutrality, reducing carbon emissions, and solving environmental problems. However, their treatment and disposal have always been a difficult problem in the environmental field. Utilizing these two materials for thermal energy storage can not only improve energy utilization efficiency but also further reduce carbon emissions during their treatment process, providing a new approach for sustainable development in the industrial sector. This article summarizes the research progress for the resource recovery of sewage sludge and red mud for direct thermal energy recovery and composite phase change energy storage. After proper treatment, sludge and red mud can be directly used as energy storage materials. In addition, sludge and red mud can be combined with phase change materials to prepare composite materials with an excellent energy storage performance. This composite has broad application prospects in fields such as solar energy utilization and building energy efficiency. However, there are still some challenges and issues in this resource recovery and utilization, such as potential environmental pollution during the treatment process, the long-term stability of energy storage materials, and cost-effectiveness, which require further research and resolution. The purpose of this paper is to evaluate the potential of sewage sludge and red mud as energy storage materials, to explore their feasibility and advantages in practical applications, and to reveal the research progress, technical challenges, and future development directions of these two materials in the field of thermal energy storage.