This study investigated the potential of wastepaper hydrolysate as a sustainable and low-cost carbon source for single-cell oil and protein production, attending to the growing need for alternative feedstocks and waste management strategies. Wastepaper, characterized by its high carbohydrate content, was subjected to enzymatic and chemo-enzymatic treatments for carbohydrate release. The chemo-enzymatic treatment performed better, yielding 65.3g l-1 of fermentable sugars. A total of 62 yeast strains were screened for single-cell oil accumulation, identifying Rhodotorula mucilaginosa M1K4 as the most advantageous oleaginous yeast. M1K4 lipid production was optimized in liquid culture, and its fatty acid profile was analyzed, showing a high content of industrially valuable fatty acids, particularly palmitic (28%) and oleic (51%). Batch-culture of M1K4 in a 3-l reactor demonstrated the strain's ability to utilize wastepaper hydrolysate as a carbon source, with dry cell weight, total lipid and protein production of 17.7g l-1, 4.5g l-1, and 2.1g l-1, respectively. Wastepaper as a substrate provides a sustainable solution for waste management and bioproduction. This research highlights the potential of R. mucilaginosa for lipid and protein production from wastepaper hydrolysate.