This study proposed an integrated process for biogas generation and biochar production from thermal hydrolysis pretreated sludge (THP sludge). In this study, the liquid and solids fractions of THP sludge were separately processed for the first time. The liquid fraction of THP sludge (THP-L) reached the biodegradability (262.6 ± 5.1 mL CH4/g tCODfeed) on the 15th day during anaerobic treatment, while the solids fraction of THP sludge (THP-S) only contributed 31.0% to the total methane production and required more than 30 days digestion time. We investigated the feasibility to convert THP-S into biochar to realize the higher value of the solids fraction. The results prove the produced biochar can be used as slow-release fertilizer. Preliminary energy analysis was performed to evaluate the energy efficiency of the integrated approach, namely, methane generation from THP-L coupled with biochar production from THP-S. The process realized energy surplus of 0.81 MWh/tonne dry sludge. In addition, THP-L digested sludge showed better dewaterability, lower yield stress and reduced viscosity during digestion. The proposed new sludge treatment process therefore has lower operating cost and higher value returns.