The incessant disposal of drywall waste, generated predominantly from construction and demolition sites, has been associated with many environmental problems. In landfill sites, it has long been linked with the generation of hydrogen sulphide, a toxic and foul-smelling gas, while the incineration of this waste results in the potential release of sulphur dioxide gas, a contributor to acid rain formation. The traditional disposal methods also result in the loss of a valuable resource. Therefore, proper management of this waste through recycling programs and subsequent returns to the end market will ensure that a valuable resource is not lost and that environmental impacts are mitigated. Many potential end markets have been identified for recycled drywall. The application as a bulking agent for composting is one of these markets, which could also provide additional calcium and sulphur nutrients to the soil. Despite the benefits of drywall waste recycling, certain challenges have crippled its recycling rate in North America. This review summarises the current situations with drywall recycling and disposal, existing markets, and the availability of competing markets. Furthermore, the potential use of drywall as a compost-bulking agent is discussed. Finally, a possible solution to improving the recycling rate and market demands for drywall is presented.