Clumping litter is ingested and clumps in the digestive track. Corncob litter can also be ingested and can cause a lethal blockage. Paper pulp litters work pretty good. Litters made from Aspen bark work well. Citrus-based litters work great but are hard to find and can be expensive.
Straw can be a safe, inexpensive litter but needs to be changed often.
Rabbit manure is an excellent fertilizer so choose a litter than can be composted. Since rabbit pellets can be used straight on the garden without worries of burning, the litter can be mulched right into the garden. Accidents outside of the litter box should be cleaned with vinegar to eliminate the odor so the rabbit doesn t return to eliminate again. If the rabbit urinates over the edge of the litter box try a covered litter box. The covered litter box also works when the rabbit kicks litter outside of the litter box.