The invention provides a rare metal-based sludge activated carbon and application thereof in the removal of sulfur, ammonia and phosphorus. The rare metal-based sludge activated carbon includes sludge activated carbon and metal elements such as manganese, cerium, praseodymium, neodymium, promethium, samarium, europium, gadolinium, terbium, dysprosium, holmium, erbium and the like, and is specifically prepared by a method comprising the following steps: mixing pyrolusite powder with activated sludge, adding a zinc chloride compounded activating agent into the mixture, activating the mixture at a high temperature, carbonizing the mixture to obtain pyrolusite compounded activated sludge, mixing the activated sludge with rare earth oxide powder and a chelating agent after the activated sludge is modified by potassium hydroxide solution, heating the mixture in a microwave oven, carbonizing the mixture to obtain rare earth compounded activated sludge, and mixing the compounded activated sludge to obtain a product. The rare metal-based sludge activated carbon prepared by the method has the advantages of high activity, high porosity, uniform pore size distribution, high adsorption capacity, capability of chelating a plurality of metals and microorganisms, high capacity of adsorbing sulfur, ammonia and phosphorus and high rate of removing the sulfur, the ammonia and the phosphorus in sewage and waste.