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With recent increases in environmental awareness, the circular economy concept, which involves turning waste into usable products, has gradually become widely accepted. Spent mushroom substrate (SMS) is an agricultural waste that lacks recycling channels in Taiwan. This study explored the feasibility of simultaneously recycling two completely different types of waste: spent mushroom substrate (SMS), an agricultural waste, and electric-arc furnace dust (EAFD), an industrial waste. Specifically, SMS was used to replace metallurgical coke as a reducing agent for EAFD, which underwent carbothermic reduction to recycle valuable metallic Zn. The results showed that if SMS and EAFD were mixed at a C/O ratio of 0.8, the degree of Zn removal achieved 95% at 1100 °C, which is 150 °C lower than the reduction temperature of the EAFD-coke mixture (due to volatile matter (VM) in SMS). For the reduction of ZnO in EAFD, with the assistance of VM in SMS, the C/O ratio can be decreased from 0.8 to 0.16 at 1300 °C, achieving a high degree of Zn removal over 95%. In addition, the torrefaction of SMS increased the fixed carbon content and improved the Zn productivity at the same C/O ratio, reaching almost the same productivity as the coke sample (SMS torrefaction = 500 °C, C/O = 0.8, reduction = 1200 °C, Zn removal~99%). Finally, CO2 emission reductions from the use of SMS were also estimated. [ABSTRACT FROM AUTHOR]