In the transition to zero waste and sustainable development, it becomes essential to use phase change materials and recycled cement in construction projects to improve energy efficiency and encourage sustainable building practices. The primary goal of this study is to determine how the properties of expanded perlite mortars are affected when Portland cement is partially replaced with recycled cement, produced by thermally treating concrete waste at 550˚C. Recycled cement substituted Portland cement in various percentages (10%, 30%, and 50%). Also, microencapsulated phase change material (m-PCM) was incorporated into the mortar in a proportion of 2 wt.% and 5 wt.%. Cement-based mortars with a 1:3 aggregate volume ratio have been developed for evaluation. The mortars were analyzed in terms of mechanical strength (flexural and compressive), water absorption, thermal properties, differential scanning calorimetry, and microstructure. The experimental results revealed a decrease in mechanical strength values when Portland cement is substituted by recycled cement, regardless of percentage. Recycled cement in proportion of 30% positively influenced the water absorption. The thermal conductivity of reference mortar was higher than that of 30% recycled cement. The reference mortar's specific thermal conductivity values were 0.466 W/(m·K) at 25°C, 0.525 W/(m·K) at 30°C, and 0.589 W/(m·K) at 35°C. On the other hand, the mortar containing 30% recycled cement exhibited much lower heat conductivity throughout these temperatures, suggesting superior insulating qualities. DSC analysis verified that adding m-PCM to the mortars increased their thermal storage capacity, which is essential for raising the energy efficiency of building materials. Nevertheless, the mechanical strength decreased as m-PCM was added. Despite decreases, all mortars satisfied the SR EN 998–1 standard's CS IV classification for interior plaster applications, which is based on compressive strength requirements. Overall, this study shows how using m-PCM and recycled materials can improve the performance of cement-based materials.