Lignin is an abundant biopolymer present in wood biomass and a promising renewable precursor for carbon materials. Lignin-derived carbon fibers (CFs) are an attractive target for sustainable composite applications, due to the global scope for achieving energy efficiencies, if cost-effective manufacturing technologies can be developed. Here, a mixture of a low-cost (<$1/kg) ionic liquid (IL), N,N-dimethylbutylammonium hydrogen sulfate, [DMBA][HSO4], and water is shown to be an effective solvent for the continuous wet-spinning of high lignin content fibers. Homogeneous solutions formed of unmodified lignins (Kraft or ionoSolv) and partially hydrolyzed poly(vinyl alcohol) were prepared in aqueous IL mixtures (60:40 wt/wt % [DMBA][HSO4]:H2O) and spun into continuous fibers with circular cross-sections using 1 M aqueous Na2SO4 or pure water as a coagulant. The lignin precursor fibers with 75–90% lignin content had tensile strengths of 25–50 MPa and moduli of 3–5 GPa. After oxidative stabilization and carbonization at 1000 °C, a carbon yield of up to 40% was achieved, with tensile strengths and moduli of up to 450 MPa and 40 GPa, respectively. With further process optimization, the new lignin spinning approach has the promise to be scalable and provide biobased CFs that are low-cost and environmentally benign.