Efficient and low-cost recycling of spent lithium iron phosphate (LiFePO4, LFP) batteries has become an inevitable trend. In this study, an integrated closed-loop recycling strategy including isomorphic substitution leaching and solvent extraction process for spent LFP was proposed. An inexpensive FeCl3 was used as leaching agent to directly substitute Fe2+ from LFP. 99% of Li can be rapidly leached in just 30 min, accompanied by 98% of FePO4 precipitated in lixivium. The tri-n-butyl phosphate (TBP)-sulfonated kerosene (SK) system was applied to extract Li from lixivium through a twelve-stage countercurrent process containing synchronous extraction and stepwise stripping of Li+ and Fe3+. 80.81% of Li can be selectively enriched in stripping liquor containing 3.059 mol·L−1 of Li+ under optimal conditions. And the Fe stripping liquor was recovered for LFP re-leaching, of which, Fe2+ was oxidized to Fe3+ by appropriate H2O2. Raffinate and lixivium were concentrated and entered into extraction process to accomplished close-loop recycling process. Overall, the results suggest that more than 99% of Li was recovered. FeCl3 holding in solution was directly regenerated without any pollutant emission. The sustainable mothed would be an alternative candidate for total element recycling of spent LFP batteries with industrial potential.