Automotive paint sludge (PS) is the waste product generated in the painting process of vehicle bodies. Although automotive spray painting is an automated operation, its efficiency is still quite low, since approximately 40–50% of the employed paint does not reach the target and, after being mixed with the collecting water, becomes PS. PS is a very complex material that contains several organic and inorganic components, in addition to 90% water immediately after production. Italian automotive factories produce from 2.5 to 5.0 kg of PS per painted car. If that figure is related to the number of vehicles produced worldwide every year, in the order of 100 million, it determines an annual PS amount in the order of 200,000–500,000 t. Consequently, a proper final destination for PS must be found. The waste management hierarchy and the principles of the circular economy require that we privilege solutions that foresee the recovery of valuable products or energy. This paper first reviews the processes and the machines that have been recently developed to obtain an enhanced mechanical dewatering of PS. The pretreatment of PS dewatering is often crucial in order to obtain high efficiency in the subsequent recovery process. Afterwards, the paper presents and discusses the recovery options that have been proposed and tested, at different scales, by several authors in the last thirty years. The processes for PS management can be grouped as follows: (i) direct employment of physically/chemically treated PS in the production of primers and sealants; (ii) utilization of PS for the production of building materials, as supplementary components of cement concrete, mortar, or bituminous mixtures; (iii) extraction of valuable organic and inorganic products by using thermal processes (pyrolysis, gasification); (iv) biological processes for PS detoxification, metal recovery, and stabilization before landfilling.