Macadamia nut shell (MNS) is a type of waste lignocellulose obtained from macadamia nut production processing. Large MNS wastes caused serious resource waste and environmental pollution. So, preparation of hydrochars from MNS via hydrothermal carbonization (HTC) is of great significance. HTC of MNS was conducted to study the effect of process parameters, including HTC temperature (180–260°C) and residence time (60–180 min) on the properties of hydrochars. Results showed that the increase in HTC temperature and residence time decreased the mass yield of hydrochars and increased the high heating value of hydrochars. Furthermore, the C content of hydrochars increased, whereas the H and O contents decreased. Mass yield of hydrochar is 46.59%, energy yield is 64.55% and the higher heating value is 26.02 MJ kg−1 at a temperature of 260°C and time of 120 min. The surface structure of hydrochars was rougher compared with that of MNS as observed via scanning electron microscopy. The chemical and combustion behaviour of MNS and hydrochars was analysed by Fourier transform infrared spectroscopy, and thermogravimetric analysis indicated that decarboxylation and dehydration reactions were the predominant pathways during the HTC process. Results showed that HTC can facilitate the transformation of MNS into solid fuel.