Lithium iron phosphate (LiFePO₄) batteries are widely used in electric vehicles and energy storage applications owing to their excellent cycling stability, high safety, and low cost. The continuous increase in market holdings has drawn greater attention to the recycling of used LiFePO₄ batteries. However, the inherent value attributes of LiFePO₄ are not prominent and the comprehensive recycling technology faces significant barriers; therefore, high-value recovery of used LiFePO₄ batteries remains a critical issue in the recycling of LiFePO₄ batteries. This study summarizes the retirement and regeneration pathways of LiFePO₄ batteries, reviewing the research progress in the regeneration of LiFePO₄ cathode wastes from the perspectives of pretreatment and resource regeneration. It concludes that direct regeneration has greater application potentials but remains at an initial research stage while indirect regeneration is suitable for situations with complex raw materials or high-value resource reserves. Focusing on the industrial development of LiFePO₄ cathode waste regeneration, this study identifies three key factors for industrialization: prerequisites for development, critical development aspects, and developmental guarantees. It showcases the short-range recycling technology for all components of LiFePO₄, along with application cases of production lines at the scale of ten thousand tons. Furthermore, it elaborates on trends in the development of lithium-ion battery recycling technologies, including residual energy detection for retired batteries, intelligent disassembly pretreatment, and direct regeneration of cathode wastes. The challenges faced in the application of LiFePO₄ battery recycling technologies include the complexity regarding raw material sources and usage conditions, the removal of various metal impurities, and the upgrading of cathode materials. Furthermore, the study proposes the following development recommendations: (1) establishing standardized management and efficient recovery channels, (2) accelerating breakthroughs in key technologies and their application conversion, and (3) enhancing publicity and promotion efforts to improve market acceptance. These strategies aim to streamline the innovation pathway of LiFePO₄ batteries from fundamental research to industrialization, promoting LiFePO₄ battery recycling and the green development of related industries.