Closed-loop textile recycling systems are revolutionizing sustainable textile manufacturing by converting discarded textiles into new, high-quality materials for repeated use. Employing mechanical, chemical, and biological methods, these systems minimize waste, reduce reliance on virgin resources, and address the industry’s significant environmental footprint. With innovations from companies like Renewcell and Evrnu, closed-loop recycling is poised to transform the textile industry, though challenges like cost and scalability remain.