Eco-conscious products are currently garnering significant attention due to their abundant availability and versatile applications in various engineering contexts. The distinctive properties of natural fibers make them readily substitutable for synthetic fibers. A substantial one million tonnes of fiber waste, primarily composed of paddy straw fiber, is generated globally. The research emphasis revolves around the adoption of the Waste to Wealth technique, a highly efficient process aimed at repurposing waste materials. This approach plays a pivotal role in curbing air pollution, specifically by preventing the incineration of the residual portion of paddy straw fiber on agricultural lands. The study involves the collection of paddy straw fiber from agricultural fields, with subsequent extraction facilitated by an extracting machine. Employing a chemical treatment process enhances the adhesion properties between the fiber and matrix. Consequently, comprehensive fiber tests, including the single fiber test, fiber tenacity, and fiber fineness, were meticulously examined for both treated and untreated fibers. The reinforcements and matrix were taken by the weight percentage of 50:50 with different fiber length (25, 50, 75, 100 mm) using the compression moulding machine with 300 mm × 300 mm × 3 mm dimensions. After making the laminates, the samples were cut as per the ASTM standard. The mechanical and morphological behavior of the hybrid fiber-reinforced polyester composites were evaluated, and the water absorption property in the concerned laminates was studied.