The amount and variety of waste increases every year. One of the places where biodegradable waste is generated is the agri-food industry, where it is possible to utilize it for the purpose of energy production. The aim of this research was to determine the possibility of using post-floatation dairy sludge as a raw material for co-pelletization with sawdust. The scope of this work included physical and chemical characterizations of the feedstock, the co-pelletization process, and the combustion of the produced pellets, combined with an exhaust analysis. The obtained values of the pellets’ density at each level of sludge addition allowed us to conclude that the obtained pellets had a good market quality and constituted a full-fledged, innovative solid fuel, in accordance with the guidelines of the latest, currently applicable ISO 17225 standard. Furthermore, adding ca. 20%wt of sludge to sawdust resulted in a 30% decrease in the pelletization power demand, and still, the combustion characteristics of the pellets met the European Ecodesign emission limitations in terms of the CO and NOx content in the exhaust. The addition of post-flotation dairy sludge to sawdust has a beneficial influence on the production of fuel pellets by decreasing the energy consumption of the pelletization process and improving the pellets’ kinetic durability. Due to legal requirements and the pursuit of the circular economy principle, one should expect an increased interest in the use of agri-food waste for the production of biofuels.