The advancement of science has facilitated increase in the human lifespan, reflected in economic and population growth, which unfortunately leads to increased exploitation of resources. This situation entails not only depletion of resources, but also increases environmental pollution, mainly due to atmospheric emissions, wastewater effluents, and solid wastes. In this scenario, it is compulsory to adopt a paradigm change, as far as the consumption of resources by the population is concerned, to achieve a circular economy. The recovery and reuse of resources are key points, leading to a decrease in the consumption of raw materials, waste reduction, and improvement of energy efficiency. This is the reason why the concept of the circular economy can be applied in any industrial activity, including the wastewater treatment sector. With this in view, this review manuscript focuses on demonstrating the challenges and opportunities in applying a circular economy in the water sector. For example, reclamation and reuse of wastewater to increase water resources, by paying particular attention to the risks for human health, recovery of nutrients, or highly added-value products (e.g., metals and biomolecules among others), valorisation of sewage sludge, and/or recovery of energy. Being aware of this situation, in the European, Union 18 out of 27 countries are already reusing reclaimed wastewater at some level. Moreover, many wastewater treatment plants have reached energy self-sufficiency, producing up to 150% of their energy requirements. Unfortunately, many of the opportunities presented in this work are far from becoming a reality. Still, the first step is always to become aware of the problem and work on optimizing the solution to make it possible.