The aim of this study was to investigate the effect of recycling on polypropylene (PP) and wood-fiber thermoplastic composites (WPCs) using a co-rotating twin-screw extruder. After nine extrusion passes microscopy studies confirmed that the fiber length decreased with the increased number of recycling passes but the increased processing time also resulted in excellent dispersion and interfacial adhesion of the wood fibers in the PP matrix. Thermal, rheological, and mechanical properties were studied. The repeated extrusion passes had minimal effect on thermal behavior and the viscosity decreased with an increased number of passes, indicating slight degradation. The recycling processes had an effect on the tensile strength of WPCs while the effect was minor on the PP. However, even after the nine recycling passes the strength of WPC was considerably better (37 MPa) compared to PP (28 MPa). The good degree of property retention after recycling makes this recycling strategy a viable alternative to discarding the materials. Thus, it has been demonstrated that, by following the most commonly used extrusion process, WPCs can be recycled several times and this methodology can be industrially adapted for the manufacturing of recycled products.