Coconut shell, a natural biopolymer, is available in high amounts as waste in many countries. It could potentially be a crucial renewable source of raw materials for the carbon fiber industry. In this study, a series of aprotic ionic liquids, [Bmim][Ace], [Bmim]Cl, [Emim][Ace], and [Emim]Cl, were used in the dissolution and regeneration process of coconut shell. The results indicate that the dissolution of coconut shell (up to 70 mg of coconut shell per g of solvent) can occur in aprotic ionic liquids under a nitrogen atmosphere at 110 °C (6 h) and 150 °C (2 h). The extraction efficiency was greatly influenced by temperature, time, particle size, and types of cations and anions in the ionic liquids. At 150 °C, 10% regenerated lignin was obtained in [Emim][Ace], which was higher compared with [Emim]Cl, [Bmim][Ace], and [Bmim]Cl. The recyclability of the ionic liquids during the dissolution process (up to four times) was also scrutinized. The structure and properties of the untreated coconut shell and regenerated lignin were characterized by Fourier transform infra-red (FTIR) spectroscopy, thermogravimetric analysis (TGA), differential scanning calorimetry (DSC), X-ray diffraction (XRD) analysis, and proton nuclear magnetic resonance (1H NMR).