Considering how important rare earth elements (REEs) are for many different industries, it is important to separate them from other elements. An extractant that binds to REEs inexpensively and selectively even in the presence of interfering ions can be used to develop a useful separation method. This work was designed to recover REEs from spent nickel–metal hydride batteries using ammonium sulfate. The chemical composition of the Ni–MH batteries was examined. The operating leaching conditions of REE extraction from black powder were experimentally optimized. The optimal conditions for the dissolution of approximately 99.98% of REEs and almost all zinc were attained through use of a 300 g/L (NH4)2SO4 concentration after 180 min of leaching time and a 1:3 solid/liquid phase ratio at 120 C. The kinetic data fit the chemical control model. The separation of total REEs and zinc was conducted under traditional conditions to produce both metal values in marketable forms. The work then shifted to separate cerium as an individual REE through acid baking with HCl, thus leaving pure cerium behind.