Carbonaceous adsorbent was prepared by physical activation of hydrochars obtained from hydrothermal carbonization (HTC) of sewage sludge. Steam activation largely enabled porosity development in the hydrochars. The resultant activated carbon was characterized for chemical adsorption ability, specific surface area, and scanning electron microscopic images. The results indicated that the best quality sewage sludge activated carbon (SSAC) was obtained at activation time of 120 min. It was observed that the product had maximum iodine value of 612 mg/g, MB adsorption capacity of 162 mg/g, and specific surface area of 585 m2/g. These properties were comparable to those from commercial activated carbon. HTC and physical activation with steam proved to be effective methods for preparation of low cost adsorbents from sewage sludge. The SSAC obtained from these processes showed good potential for adsorption or soil conditioning.