The Gibbs free energy of mixing dissipated when fresh river water flows into the sea can be harnessed for sustainable power generation. Pressure retarded osmosis (PRO) is one of the methods proposed to generate power from natural salinity gradients. In this study, we carry out a thermodynamic and energy efficiency analysis of PRO work extraction. First, we present a reversible thermodynamic model for PRO and verify that the theoretical maximum extractable work in a reversible PRO process is identical to the Gibbs free energy of mixing. Work extraction in an irreversible constant-pressure PRO process is then examined. We derive an expression for the maximum extractable work in a constant-pressure PRO process and show that it is less than the ideal work (i.e., Gibbs free energy of mixing) due to inefficiencies intrinsic to the process. These inherent inefficiencies are attributed to (i) frictional losses required to overcome hydraulic resistance and drive water permeation and (ii) unutilized energy due to the discontinuation of water permeation when the osmotic pressure difference becomes equal to the applied hydraulic pressure. The highest extractable work in constant-pressure PRO with a seawater draw solution and river water feed solution is 0.75 kWh/m3 while the free energy of mixing is 0.81 kWh/m3—a thermodynamic extraction efficiency of 91.1%. Our analysis further reveals that the operational objective to achieve high power density in a practical PRO process is inconsistent with the goal of maximum energy extraction. This study demonstrates thermodynamic and energetic approaches for PRO and offers insights on actual energy accessible for utilization in PRO power generation through salinity gradients.