Anaerobic digestion is an efficient way of using a wet fraction of municipal solid waste (MSW) for energy purposes as it can produce biogas. The moisture content of the digestate after application of mechanical dewatering is still high, and the amount of heat needed for drying is significant. Hydrothermal carbonization (HTC) is a process that can potentially offer great benefits by improved mechanical dewatering and valorization of the digestate into a better quality solid fuel. This study focuses on the determination of the optimum HTC process conditions to recover water from the MSW digestate. Different process conditions as temperature (180, 200, and 230 °C) and residence time (30, 60, and 120 min) were tested. Furthermore, a mass and energy balance was carried out and a process model in Aspen Plus was built. Results showed that HTC treatment increased the water recovery (40–48%) during the dewatering process compared with the original feedstock (18%). The process model showed a positive energy balance of 110 kWh per ton of MSW digestate treated with an electrical efficiency of 23.9%.