Presence of heavy metals in sludge can severely limit land application due to their bioavailability. The current work studied distribution and risk as well as leaching toxicity of heavy metals in textile sludge treated with hydrothermal carbonization (HTC) at different conditions. Treatment temperature and time can significantly affect characteristics of heavy metals in sludge. For the treatment at 220 °C and 3 h, the content of Cu, Cr, Mn, and Zn existed in form F1 + F2 (water soluble and bound to carbonate and Fe-Mn oxides) dropped by 4.7, 7.1, 8.8, and 7.3%, while the content of Cu, Cr, and Mn in form F4 (bound to quartz, feldspars, etc) increased by 12.9, 19.1, and 10.6%, respectively. This effectively lowered the bioavailability and leaching rate of heavy metals in sludge. Addition of weak alkaline Al(OH)3 could efficiently force the transformation of F1 to F4, possibly because of the increased pH value of sludge. HTC processing might be an effective way of fixing heavy metals in textile sludge.