Rare Earth Elements (REE) are nowadays considered critical raw materials due to their increasing use in modern industry and their shortage of supply. Acid mine drainage (AMD) contains REE concentrations several orders of magnitude higher than the rest of continental and marine waters, and the sludge from its treatment may become a supplementary source of REE. Schwertmannite, a Fe(III)-sulfate-hydroxide is the most common mineral precipitated from AMD and a main constituent of the neutralization sludge. The objective of this work is to study the mechanism of REE retention in synthetic schwertmannite and to predict the REE behavior in a column experiment mimicking an AMD passive remediation system. Suspensions of synthetic schwertmannite in sulfate solutions show that Y and the lanthanides are effectively sorbed at pH values higher than 4.5, and sorption is complete at pH values higher than 6.5. The experimental partition coefficients clearly show a preferential enrichment of heavy REE in the solid phase. Unlike the rest of the REE, Sc sorption occurred at a lower pH, from 3 to 5. The experimental results have been described with a non-electrostatic surface complexation model in which the aqueous complex MSO4+ exchanges with two H+ from the surface of schwertmannite, forming a bidentate surface complex, (XO)2MSO4-. Scandium sorption was also accurately predicted with the addition of a second bidentate surface complex, (XO)2MOH. The equilibrium constants for REE sorption on schwertmannite calculated in the present work, together with those for REE sorption on basaluminite (Lozano et al., 2019, GCA, 258, 50–62) were used to model the behavior of different REE observed in the pore water and solid of a column experiment. Schwertmannite and basaluminite were the main solid phases formed due to the progression of the neutralization. First schwertmannite precipitated at pH below 4 and then basaluminite precipitated at pH above 4. Both minerals can sorb REE in a similar pH range. However, since Y and the lanthanides sorbed at pH values higher than 5, their sorption only occurred on basaluminite. In contrast, the Sc sorption edge extended from pH 3 to 5 and Sc partially sorbed on schwertmannite. As a practical consequence, REE preferentially accumulated in the basaluminite residue of AMD neutralization systems, but a minor fraction of Sc can be retained in the schwertmannite waste.