Agri-food waste biomass (AWB) is consolidating as a relevant bioresource for supplying material products and energy in a circular bioeconomy. However, its recovery and sustainable processing present trade-offs that must be understood. The integration of multi-criteria decision analysis (MCDA) into life-cycle assessment (LCA) tools has emerged as a novel way to address this challenge. This paper aims to conduct a systematic literature review to critically synthesize how MCDA has been integrated into LCA in an assessment framework and how helpful it is in AWB’s circular bioeconomy transition. The literature shows that the most studied AWBs are rice husk, sugarcane bagasse, and household food waste. These are processed through the technologies of composting, anaerobic digestion, and pyrolysis for applications such as biofuels, bioenergy, and soil amendment. Environmental LCA (E-LCA) is the most widely used LCA tool, while both the analytical hierarchy process (AHP) and the technique for ordering preference by similarity to the ideal solution (TOPSIS) are the most applied techniques for MCDA. The current trend of integrating MCDA into LCA does not fully cover the LCA phases, favoring solely the impact assessment phase and indicating that the other phases are overlooked. The potential and involvement of the stakeholders are partially explored. Although there are holistic sustainability assessments, the social implications are rarely considered. The number of MCDA/LCA studies is expected to increase, assessments at the micro-, meso-, and macro-scales to become more articulated, and the impact of the results to become more aligned with government and company goals.