The study investigates the production of highly functionalized carbonaceous materials through hydrothermal carbonization of cellulose at temperatures ranging from 220 to 250°C. The process involves the dehydration of cellulose, leading to the formation of agglomerates of carbonaceous microspheres (size ~2-5 μm). The chemical and structural characteristics of the resulting solid product, denoted as hydrochar, are analyzed using various techniques such as SEM, FTIR, Raman spectroscopy, and XPS. The results show that the hydrochar consists of small clusters of condensed benzene rings with stable oxygen-containing groups in the core (ether, quinone, pyrone) and more reactive/hydrophilic oxygen functionalities (hydroxyl, carbonyl, carboxylic, ester) in the shell. The onset of carbonization occurs at around 220°C, and the hydrochar exhibits a high carbon content (70.7-72.5 wt%) and poor porosity. The formation of hydrochar is proposed to follow a mechanism involving the hydrolysis of cellulose chains, dehydration and fragmentation of monomers, polymerization or condensation of soluble products, aromatization, nucleation, and growth. This study highlights the potential of hydrothermal carbonization as an effective method for producing carbon materials from cellulose.The study investigates the production of highly functionalized carbonaceous materials through hydrothermal carbonization of cellulose at temperatures ranging from 220 to 250°C. The process involves the dehydration of cellulose, leading to the formation of agglomerates of carbonaceous microspheres (size ~2-5 μm). The chemical and structural characteristics of the resulting solid product, denoted as hydrochar, are analyzed using various techniques such as SEM, FTIR, Raman spectroscopy, and XPS. The results show that the hydrochar consists of small clusters of condensed benzene rings with stable oxygen-containing groups in the core (ether, quinone, pyrone) and more reactive/hydrophilic oxygen functionalities (hydroxyl, carbonyl, carboxylic, ester) in the shell. The onset of carbonization occurs at around 220°C, and the hydrochar exhibits a high carbon content (70.7-72.5 wt%) and poor porosity. The formation of hydrochar is proposed to follow a mechanism involving the hydrolysis of cellulose chains, dehydration and fragmentation of monomers, polymerization or condensation of soluble products, aromatization, nucleation, and growth. This study highlights the potential of hydrothermal carbonization as an effective method for producing carbon materials from cellulose.