Thermochemical methods are regarded as promising approach for managing sludge, that can achieve resources and energy recovery, volume reduction followed by efficient elimination of microorganisms. This review highlights an extensive description of the implementation of thermochemical technologies involving pyrolysis, gasification and hydrothermal liquefaction for valorisation of sludge into bio-fuel thus reducing the issues related to surplus generation and accumulation of sludge in environment affecting human health followed by rapid depletion of energy resources. The paper addresses working mechanism of thermochemical processes, their implementation for sludge conversion to bio-fuel and common factors affecting the process efficiency. Various studies have proved possible potential of thermochemical techniques for conversion of sludge to bio-fuel obtaining a high yield of bio-fuel and syngas. However, few technical challenges are still there that requires further studies and understanding for a better commercialization on industrial-scale and subsequently the future perspectives have also been analysed. Data collected from existing studies revealed that hydrothermal liquefaction has the efficiency to be proved better than other thermochemical technologies for proper valorisation of sludge resulting in high bio-fuel yield. © 2022 Elsevier Ltd