Hydrochars derived from municipal sewage sludge was analyzed for its feasibility for value-added recycling. Results of carbon content and elemental composition suggested that the hydrochars might not be comparable with pyrochars regarding to the carbon sequestration, long-term stability and fuel quality. Application as soil amendment would be a better approach for hydrochar utilization. To examine the potential benefits and risks of that, the total and available content of nutrients (i.e. N, P, and K) were measured, and the potentially toxic elements (PTEs, i.e. Zn, Cu, Pb, Ni and Cd) were analyzed for the total content, speciation, and leaching potential. Compared with pyrochars derived from the same feedstock, hydrochars had lower pH and higher cation exchange capacity. The available content of N (1.58–6.87 g/kg), P (0.270–0.901 g/kg), and K (0–0.873 g/kg) in the chars was less than the feedstock sludge (3.33 g/kg N, 3.02 g/kg P, 2.07 g/kg K), but still far higher than that of the agricultural soil (i.e. 0.014–0.488 g/kg N, 0.02 g/kg P, <0.1–0.272 g/kg). Remarkably, hydrochars showed better nutritional balance than pyrochars for its higher available K content. Risk of potentially toxic elements contamination by the sludge was efficiently reduced in either hydrochars or pyrochars, except the high leaching potential of Zn in pyrochars. Overall, in addition to the advantages of the hydrothermal carbonization process as energy saving and value-added liquid by-products, the hydrochars derived from sludge, with sufficient and balanced nutrients and limited PTEs pollution risk, can be a feasible and value-added material as soil amendment.