This study proposed a cleaner pyrometallurgical lead-acid battery (LAB) recycling method for lead extraction and sulfur conservation without an excessive amount of SO2 generation. A reducing atmosphere was introduced to the lead paste recycling system to selectively reduce PbSO4 to PbS. At the same time, PbO and PbO2 components contained in the lead paste were also reduced to metallic Pb. Then, the intermediate PbS further reacted with a sulfur-fixing agent, typically Fe3O4, to generate PbO and FeS. Sulfur was transformed from PbSO4 to PbS and finally conserved as FeS. Thus, SO2 emissions and pollution were significantly eliminated. This work investigated the thermodynamic and experimental feasibility and phase conversion mechanism of this proposed method, the detailed lead extraction and sulfur fixing mechanisms were clarified, and the phase transformation and microstructural evolution processes were characterized. Additionally, a bench experiment of industrial, end-of-life LAB paste was conducted to detect the lead recovery and sulfur fixation efficiency.