A new char-based insulation foam (CIF) is developed using coal-derived pyrolysis char (PC) and lignin, a paper and pulp industry byproduct. In this study, CIF is prepared by adopting the microwave method and Response Surface Methodology (RSM) is utilized to optimize predictions about the properties such as thermal conductivity, foam texture, compressive strength, and pore distribution of CIF. The three independent variables including percent char content, lignin/char ratio, and foaming agent/polyol ratio are considered in the RSM methodology. The face-centered central composite design is selected to obtain 17 test runs. Optimization of the predicted responses is performed to find the recipe considering a composite desirability function. Confirmatory test results show agreement between the predicted and observed values, with the percent error ranging from 0.00 % to 11.35 %, thereby confirming the accuracy of the prediction equations. The optimized CIF exhibits a thermal conductivity of 0.0633 W/m.K and a compressive strength of 695 kPa making it comparable to or better than traditional building insulation products such as fiber insulation, polymer composite, particle board, and ceramic glass foam. Therefore, this new CIF has the potential to be used as an energy-saving insulation material for building envelopes.