The present investigation deals with the viability of the use of recycled oil pouch material, which is a coextruded film of LDPE/LLDPE blend and nylon 6. and the scope for improvement of its properties by addition of compatibilizers. In fact, the use Of reactive compatibilizers in recycling of mixed polymer waste was well proposed. Two efficient reactive compatibilizers. viz. zinc salt of ethylene methacrylic acid copolymer (Surlyn ionomer) and polyethylene grafted maleic anhydride (Fusabond) were used for this purpose. The effectiveness of the use of compatibilizer during recycling was evaluated by infrared spectroscopy, melt flow index, scanning electron microscopy, differential scanning calorimetry. X-ray diffraction analysis and mechanical properties. It was found that both thermal stability and mechanical properties of the recycled blend were remarkably improved by the addition of compatibilizing,agent. Surlyn ionomer gave the best compatibilizing effect. However. the overall performances of compatibilized recycled Oil Pouch materials indicate their Suitability in several demanding applications.