The article provides an overview of the methods used for processing of red mud to extract rare earth elements (REEs). Red mud is a toxic and highly alkaline waste. Several methods have been adopted and been practiced all over the world for the processing of red mud. Complex processing of red mud is cost-effective since red mud contains elements such as iron, aluminum, titanium, calcium, and rare earth metals. It has been observed that the acid leaching of red mud can almost completely recover the rare earth elements in the solution with various individual techniques and also a combination of them. Therefore, the choice of extraction method depends on the form in which the element occurs in the solution. However, relatively low concentrations of rare earth in the solution and significant amounts of impurities increase the cost of getting the final commercial products. To ensure the cost-effectiveness of the process involving rare earth’s extraction from red mud, it is necessary to increase their content by several times. This article presents the various studies that have been carried out in these aspects and the possibility of making this resource a sustainable one for REE extraction with a special focus on scandium replenishment.