Engineering plastics, such as polyoxymethylene (POM), are high-performance thermoplastics designed to withstand high temperature or mechanical stress and are used in electronic equipment, the automotive industry, construction, or specific household utensils. POM is immiscible with other plastics but due to a low volume of production, no methods were developed to separate it from the residual plastic waste stream. Therefore, POM recycling is minimal despite its high market value. This paper provides a proof of concept for tracer-based sorting (TBS) as a potential solution for increasing the separation efficiency of low-volume, high-quality polymers. For this purpose, yttrium oxide (Y2O3) and cerium (IV) oxide (CeO2) have been embedded into the POM matrix. Mechanical tests of samples at varying concentrations (0.1 to 1000 ppm) of both tracers were conducted, followed by an analysis of detectability and dispersibility using a portable X-ray fluorescence spectrometer (p-XRF), subsequently optimizing detection time and tracer concentration. Finally, an experimental scenario was developed to test the fate and potential recovery of the tracer material after the thermal treatment of plastics. A low detectable concentration, short measurement time, low influence on mechanical parameters of the compound, and low loss ratio after simulated recycling prove Y2O3 to be a suitable tracer for the industrial implementation of TBS.