Expressional dependence on the consumption of products from fossil sources still prevails in the third decade of this century. Meanwhile, the environmental impacts caused by their excessive use, especially fuel, have been criticized more intensely and compromise the sustainability of the Earth. In addition, it influences the consolidation of new sources and ecological matrices. Therefore, this scenario requires the search for new natural, renewable and sustainable sources. In this context, evidence indicates that biomass is one of the sources with solid foundations to replace fossil sources. Urban lignocellulosic biomass shows various attributes, such as being abundant, low cost, easy to locate, renewable, etc. In this line, thermochemical methods have been cited as the most appropriate and sustainable for their transformation. In this context, this scientific review explored the transformation of urban lignocellulosic biomass into carbon fractions through hydrothermal carbonization. After the components of the urban lignocellulosic biomass were provided, such as the chemical composition, physical-chemical and energetic properties, the general vision of hydrothermal carbonization was introduced, with the temperature and residence time were identified as the parameters with the major influence on the thermochemical reaction. Finally, the authors described the capability of hydrothermal carbonization to yield products in the liquid, gas, and solid states (hydrochar), along with addressing the challenges associated with hydrothermal carbonization of urban lignocellulosic waste.