Increasing the recovery of textiles from municipal solid waste (MSW) is important for improving environmental sustainability. In 2015, over 10.5 million tons of textile waste was landfilled, which is 7.6% of total landfilled MSW according to the U.S. EPA. For all materials, recycling in the U.S. has increased over the past decade to 25.8% of the weight of the waste generated, textile recycling is below this level at 15.3%. This research quantifies the availability of used textiles by material type from Goodwill of Delaware (Goodwill-DE), a thrift store franchise, between 2012 and 2014. It examines the feasibility of recycling this amount of available discarded textiles, specifically cotton, into U.S. industrial subsectors that traditionally use new cotton textiles. A hybrid product model was created using EIO-LCA to compare economic and environmental impacts in the cut and sew apparel, airplane and automotive seating, upholstered furniture, and textile bag manufacturing industrial subsectors. Economic impacts on supply purchases and profits were considered. Environmental impacts in energy use and CO2 equivalent emissions were examined. As a result, utilizing all of Goodwill-DE’s annual discarded cotton textiles by the cut and sew apparel industrial subsectors would have positive impacts in terms of supply purchase and energy savings and reduction in CO2 equivalent emissions, but negative impacts on profits. Supply purchase savings are greater than the profit loss, resulting in a net economic gain for the cut and sew apparel industrial subsectors. Of the seven industrial subsectors considered, the U.S. cut and sew apparel industries would benefit the most from utilizing used cotton textiles.