Silver nanoparticles (Ag-NP) discharged into the municipal sewer system largely accumulate in the sewage sludge. Incineration and agricultural use are currently the most important strategies for sewage sludge management. Thus, the behavior of Ag-NP during sewage sludge incineration is essential for a comprehensive life cycle analysis and a more complete understanding of the fate of Ag-NP in the (urban) environment. To address the transformation of Ag-NP during sewage sludge incineration, we spiked metallic Ag(0)-NP to a pilot wastewater treatment plant and digested the sludge anaerobically. The sludge was then incinerated on a bench-scale fluidized bed reactor in a series of experiments under variable conditions. Complementary results from X-ray absorption spectroscopy (XAS) and electron microscopy-energy dispersive X-ray (EM-EDX) analysis revealed that Ag(0)-NP transformed into Ag2S-NP during the wastewater treatment, in agreement with previous studies. On the basis of a principal component analysis and subsequent target testing of the XAS spectra, Ag(0) was identified as a major Ag component in the ashes, and Ag2S was clearly absent. The reformation of Ag(0)-NP was confirmed by EM-EDX. The fraction of Ag(0) of the total Ag in the ashes was quantified by linear combination fitting (LCF) of XAS spectra, and values as high as 0.8 were found for sewage sludge incinerated at 800 °C in a synthetic flue gas atmosphere. Low LCF totals (72% to 94%) indicated that at least one relevant reference spectrum was missing in the LCF analysis. The presence of spherical Ag-NP with a diameter of <50 nm extending into the sub-nm range was revealed by electron microscopy analyses. The rapid formation of Ag(0)-NP from Ag2S during sewage sludge incineration, as demonstrated in this study, needs to be considered in the life cycle assessment of engineered Ag-NP.