The demolition of structures constitutes a pivotal phase within urban renewal and sustainable development initiatives, necessitating the selection of an optimal methodology based on criteria such as safety, cost-effectiveness, speed, material recycling, and environmental impact. This study examines traditional techniques (e.g., manual demolition and wrecking ball), modern methods (e.g., hydraulic excavators), and advanced systems (e.g., TECOREP systems and diamond wire cutting) through data collected from a diverse range of projects. Utilizing multicriteria decision-making (MCDM) techniques—including the Analytic Hierarchy Process (AHP), Technique for Order Preference by Similarity to Ideal Solution (TOPSIS), and Preference Ranking Organization Method for Enrichment Evaluations (PROMETHEE)—the research assesses key criteria and develops various scenarios for optimal selection. The findings indicate that the choice of demolition technique is contingent upon specific project requirements (e.g., urban, industrial, or historical contexts), with the combined application of methods enhancing efficiency, safety, and environmental sustainability concurrently. The study addresses operational challenges, technological opportunities, and socio-economic considerations, proposing solutions that aim to reduce costs, enhance worker safety, and manage waste effectively. Sensitivity analysis and comparisons with empirical data from real-world projects substantiate the robustness of the results across variations in environmental, economic, and legal conditions. Data derived from Iranian projects underscore unique cultural and financial constraints, thereby distinguishing this research from global studies. The integration of advanced technologies and decision-making tools presents an innovative approach to sustainable demolition practices, supplemented by recommendations for policy formulation and training initiatives to facilitate implementation.