With the widespread adoption of lithium iron phosphate (LiFePO₄) batteries, the imperative recycling of LiFePO₄ batteries waste presents formidable challenges in resource recovery, environmental preservation, and socio-economic advancement. Given the current overall lithium recovery rate in LiFePO₄ batteries is below 1 %, there is a compelling demand for an eco-friendly, cost-efficient, and sustainable solution. This study introduces a green and sustainable recycling method that employs environmentally benign formic acid and readily available oxygen as reaction agents for selectively leaching lithium from discarded lithium iron phosphate powder. Formic acid was employed as the leaching agent, and oxygen served as the oxidizing agent. Utilizing a single-factor variable approach, various factors including formic acid concentration, oxygen flow rate, leaching time, liquid-to-solid ratio, and reaction temperature were individually investigated. Moreover, the feasibility of this method was explored mechanistically by analyzing E-pH diagrams of the Li-Fe-P-H₂O system. Results demonstrate that under conditions of 2.5 mol/L formic acid concentration, 0.12 L/min oxygen flow rate, 25 mL/g liquid-to-solid ratio, 70 °C reaction temperature, and 3 h reaction time, lithium leaching efficiency exceeds 99.9 %, with iron leaching efficiency only at 1.7 %. Moreover, we also explored using air instead of oxygen as the oxidant and get the excellent lithium leaching rate (97.81 %) and low iron leaching rate (4.81 %), which shows the outstanding selectivity. Furthermore, the environmentally benign composition of the chemical reagents, comprising only C, H, and O elements, establishes it as a genuinely green and sustainable technology for secondary resource recovery. Additionally, the study also demonstrated the substitution of air for oxygen, indicating excellent leaching performance, good selectivity, and the promising application prospects of the approach. It can be considered as a highly environmentally friendly, cost-effective, and efficient approach. Nevertheless, in the current context of carbon neutrality and sustainable development, this method undoubtedly holds excellent prospects for industrialization.