Efficient waste paper recycling has a significant role in the sustainable environment. Recyclable waste paper as a fundamental ingredient of municipal solid wastes (MSWs) is indeed an “urban ore”. Waste papers are considered as the solid recovered fuel which is recovered from MSW. Recyclable waste papers are segregated into various grades to produce high-quality products. Moreover, sorted paper streams save energy, chemicals, and water, as well as reduce sludge and rejects. Information technology is widely integrated with the waste management industry into its operations such as recycling, reuse, segregating based on categories and so on. This review article focuses on the life cycle of waste paper and existing waste paper sorting techniques. In the paper industry, many types of sensors are used in different mechanical and optical waste paper sorting systems. Such sensors include lignin, gloss, stiffness, mid-infrared, infrared, and color sensors. In this review, also described the effectiveness of different waste paper sorting systems, and finally, recommended appropriate waste paper sorting techniques based on effectiveness and low-cost implementation.