Underground infrastructure projects pose significant environmental risks due to resource consumption, ground stability issues, and potential ecological damage. This review explores sustainable practices for mitigating these impacts throughout the lifecycle of underground construction projects, focusing on recycling and reusing excavated tunnel materials. This review systematically analyzed a wide array of sustainable practices, including on-site reuse of excavated tunnel material as backfill, grouting, soil conditioning, and concrete production. Off-site reuses explored are road bases, refilling works, value-added materials, like aggregates and construction products, vegetation reclamation, and landscaping. Opportunities to recover and repurpose tunnel components like temporary support structures, known as “false linings”, are also reviewed. Furthermore, the potential for utilizing industrial and construction wastes in underground works are explored, such as for thermal insulation, fire protection, grouting, and tunnel lining. Incorporating green materials and energy-efficient methods in areas like grouting, lighting, and lining are also discussed. Through comprehensive analysis of numerous case studies, this review demonstrates that with optimized planning, treatment techniques, and end-use selection informed by material characterization, sustainable practices can significantly reduce the environmental footprint of underground infrastructure. However, certain approaches require further refinement and standardization, particularly in areas like the consistent assessment of recycled material properties and the development of standardized guidelines for their use in various applications. These practices contribute to broader sustainability goals by reducing resource consumption, minimizing waste generation, and promoting the use of recycled and green materials. Achieving coordinated multi-stakeholder adoption, including collaboration between contractors, suppliers, regulatory bodies, and research institutions, is crucial for maximizing the impact of these practices and accelerating the transition towards a more sustainable underground construction industry.