In the present review article, we summarize recent advances in extraction and separation of rare-earth metals using ionic liquids. Rare-earth metals have unique electronic and magnetic properties. In Japan, increasing amounts of rare-earth metals are being used every year in industries employing cutting-edge technology. Therefore, maintaining a stable supply of rare-earth metals is important. In recent times, extensive research has been carried out on the use of ionic liquids for the extraction of rare-earth metals; this is because the extraction ability and/or selectivity for rare-earth metals have been found to increase when using hydrophobic ionic liquids, which have potential applications in liquid-liquid extraction processes. In the octyl(phenyl)-N,N-diisobutyl carbamoylmethyl phosphine oxide (CMPO) extraction system using ionic liquids, the extraction ability was more than 10(3) times better than that when using n-dodecane; however, stripping of the extracted metal ions was difficult in the former case. In initial research on the extraction processes based on ionic liquids, industrial extractant PC-88A was employed as well as CMPO, but issues resulting from the low solubility of these extractants and their metal complexes remain to be addressed. To overcome this problem, a new extractant, N, N-dioctyldiglycol amic acid (DODGAA), which is highly soluble in the ionic liquids, has been synthesized. DODGAA shows better performance for the separation of rare-earth metals in ionic liquids than in n-dodecane. Furthermore, a liquid membrane system based on ionic liquids has been developed for the separation and recovery of rare-earth metals. The use of a liquid membrane system may help in reducing the amount of ionic liquids required for metal recovery.