The rare-earth elements (REEs) are Europe’s most critical raw-materials group due to the high supply dependency on the Chinese REEs near-monopoly. The NdFeB permanent magnet in EOL hard disk drivers (HDDs) is an actual source of REEs. However, REEs recycling routes are still under development. Hydrometallurgical routes are attractive because they are versatile, but concerns arise regarding their chemical consumption and the implication to the environment. An ex-ante environmental analysis supports the launch and consolidation of the route in an environmentally sound manner. This work aims to identify the environmental hotspots of a theoretical hydrometallurgical recycling route for REEs, which uses acetic acid for leaching and oxalic acid for precipitation. The route also allows chemical recycling through a loop within it. The ultimate goal is to draw recommendations toward improving the environmental profile of the technology before it gets implemented. The evaluation is carried using the Life Cycle Assessment (LCA) methodology according to a dedicated framework for ex-ante analysis, including upscaling. The analysis highlights as hotspots the oxalic acid in the precipitation stage and the direct dust emissions and its treatment in the fragmentation of HDDs. Moreover, results indicate that acetic acid regeneration within the system is more burdensome than use the chemical produced from raw materials. The premature assessment also indicates that the environmental profile of the emerging technology is potentially inferior to the established primary production. A limitation of the model arises from the economic allocation for multifunctional processes due to the approach developed to stipulate the price of some co-products. Overall, the uncertainties carried with the ex-ante LCA prevent any assertive declaration regarding the recycling route’s environmental performance. However, the exercise contributes to the problem-solution space. It gives directions to the next steps: better data collection for the RE recovery phase, less dust production in the fragmentation phase, other means for precipitation of REEs, and variation in the leaching solid-liquid ratio.