With the acceleration of urbanization, the production of municipal sludge has surged. Traditional thermal drying disposal technologies face limitations in widespread application due to their high energy consumption and cost. Biodrying technology, which utilizes microbial metabolic heat to evaporate moisture, offers advantages such as low energy consumption, low cost, and environmental friendliness, aligning with the goals of carbon peaking and carbon neutrality. This paper reviews the research progress in biodrying technology, analyzes the impact of key factors—including temperature, microorganisms, moisture content, conditioning agents, aeration, and turning—on drying efficiency, and explores the application prospects of co-processing biodried sludge in cement kilns. Research indicates that maintaining high temperatures >60℃), optimizing the ratio of microbial inoculants, controlling initial moisture content (55%~65%), and implementing reasonable aeration strategies can significantly enhance drying efficiency. Domestic and international engineering cases confirm that biodrying technology can effectively achieve sludge reduction and resource utilization. Its integration with cement kiln co-processing can further reduce carbon emissions and yield significant economic benefits. Future research should focus on improving the efficiency of microbial organic matter utilization and optimizing models to promote wider application of the technology.