With an increasing growth of human population, rising GDP levels and more affluent lifestyles, the human race is consuming more and more which leads to a continuously growing demand for renewable and non-renewable resources. Therefore, the issue of resource scarcity is emerging, because it is questionable whether economic growth can be sustained in a world with finite natural resources. The main purpose of this work is to analyze the potential of Industry 4.0 applications to realize a more sustainable manufacturing and to create a circular economy (CE). Even if the economy nowadays is still locked into a system favoring the linear model of production and consumption, tighter environmental standards, resource scarcity and changing consumer expectations will force organizations to find alternatives. To do so, new technologies can be used to trace materials through the supply chain and to track product status during its life cycle. This development will create opportunities to accelerate the transition towards the model of a CE. Case examples show that companies are starting to capitalize on the potential of emerging technologies to rearrange production, services, business models or whole organizations in a more sustainable way. Main conclusions of this research are that there is a high potential of Industry 4.0 to ensure more sustainable manufacturing methods or a CE. This is shown by analyzing the value drivers of Industry 4.0, the potential of rearranging value chains and emerging business models. Overall, smart products and Industry 4.0 technologies could generate significant economic, environmental and social benefits and are able to contribute to strive towards a CE.