Lignin is a nature’s wonder material that allows trees to grow vertically and have strong and biochemically resistant structures. However, the majority of lignin is burned in the forest industry. The objective is to make a paradigm shift in the use of lignin by developing circular lignin materials with functionalities arising from well-defined nanostructures. This project faces two outstanding challenges. The first relates to overcoming the instability of lignin nanoparticles in organic solvents and under alkaline conditions, which currently restricts synthesis of advanced lignin materials. The second is to develop lignin nanoparticles and lignin fibres structurally incorporating inorganic and metal nanoparticles. By overcoming these obstacles, we will have functional lignin building blocks for circular vitrimer adhesives, electrochemical catalysts, magnetically responsive nanocomposite gels, and colloidal crystals. Synthesis and assembly of these materials requires considerable contributions to method development that will open wholly new frontiers for sustainable lignin materials. Far-reaching implications beyond materials science include excellent opportunities for interdisciplinary studies across environmental sciences, chemical and process engineering, and life sciences.