This paper presents a pilot study investigating the manufacturing process and properties of novel bio-based materials intended for insulation in building walls. Panels with a thickness of 20mm were fabricated by mixing grass, water, and potato starch, followed by pressing and heating. Various combinations of coarse, medium, and fine Cynodon dactylon particles, along with three starch-to-water ratios (1:3, 1:4, and 1:5), were explored. The panels underwent characterization in terms of density, quasi-static compressive behavior, quasi-static flexural strength, high-strain compressive strength, sound absorption coefficient, thermal conductivity, and degradation under external environmental conditions. Results indicate that density is influenced by particle size and micro-structure arrangement, while static compressive stiffness is affected by both particle size and starch-to-water ratio. The panels exhibit low damage and effective dissipation under compressive high-strain deformation. The sound absorption test reveals superior capabilities (Class III of ISO 11654:1997) due to the porous structure. Thermal conductivity values ranging from 0.075 to 0.092 Wm−1K−1 support the application as a thermal insulation material. Furthermore, the study demonstrates that reducing particle size and increasing starch-to-water ratio enhance mechanical properties while slightly diminishing acoustic and thermal performance. Under external environmental conditions, the panels lasted more than 1 months, demonstrating acceptable resistance to rain and humidity. Comparative analysis with other natural bio-based materials shows that Cynodon dactylon-starch panels possess similar or superior physical, mechanical, acoustic, and thermal characteristics. These findings suggest that these panels could serve as environmentally friendly alternatives in the insulation materials sector within the building industry.