In the context of constant growth in the utilization of the Li-ion batteries, there was a great surge in the quest for electrode materials and predominant usage that lead to the retiring of Li-ion batteries. This review focuses on the recent advances in the anode and cathode materials for the next-generation Li-ion batteries. To achieve higher power and energy demands of Li-ion batteries in future energy storage applications, the selection of the electrode materials plays a crucial role. The electrode materials, such as carbon-based, semiconductor/metal, metal oxides/nitrides/phosphides/sulfides, determine appreciable properties of Li-ion batteries such as greater specific surface area, a minimal distance of diffusion, and higher conductivity. Various classifications of the anode materials such as the intercalation/de- intercalation, alloy/de-alloy, and various conversion materials are illustrated lucidly. Further, the cathode materials, such as nickel-rich LiNixCoyMnzO2 (NCM), were discussed. NCM members such as NCM 333, NCM 523 that enabled to advance for NCM622 and NCM81are reported. The nanostructured materials bridged the gap in the realization of next-generation Li-ion batteries. Li-ion batteries’ electrode nanostructure synthesis, performance, and reaction mechanisms were considered with great concern. The serious effects of Li-ion batteries disposal need to be cut significantly to reduce the detrimental effect on the environment. Hence, the recycling of spent Li-ion batteries has gained much attention in recent years. Various recycling techniques and their effect on the electroactive materials are illustrated. The key areas covered in this review are anode and cathode materials and recent advances along with their recycling techniques. In light of crucial points covered in this review, it constitutes a suitable reference for engineers, researchers, and designers in energy storage applications.