Coal-fueled chemical-looping combustion (CF-CLC) is an advanced process for highly efficient coal combustion with in situ CO2 capture. The feasibility of applying CF-CLC is heavily dependent on the suitability of the oxygen carrier (OC). In this study, the abundant red mud bauxite waste produced from Bayers alumina production process is proposed as a cost-effective oxygen carrier using a direct granulation method. A screening test was carried out to select the best OC from samples prepared at various calcination temperatures. The regeneration and reduction behavior of red mud OCs were extensively investigated in a simulated CLC process while considering the influence of water vapor and reaction temperature. A synthetic iron-based OC was used as a reference to evaluate the performance of the red mud OCs. The fresh and used OC particles were characterized by XRD, SEM, and BET analyses to interpret the behavior of the solid particles. The leaching behavior of the raw red mud and the OC samples was tested using simplified leaching tests to assess the feasibility of disposal of the spent red mud OCs in a landfill.