In this research, grey cast iron scraps were recycled into powders and were then used in combination with iron powder for producing iron based powder metallurgy parts. Design of experiments was conducted by response surface method for both the green and sintered parts. For the green properties, the parameters cast iron powder percentage and compaction pressure, and for the sintered parts, the mentioned parameters in addition to sintering temperature and sintering time were selected each in five levels as the input process parameters. Transverse rupture strength and elastic modulus were measured as the responses. Regression analysis and analysis of variance were used to investigate the effect of input parameters, develop the mathematical models and evaluate the validity of the models. Scanning electron microscopy and optical microscopy micrographs were provided to better understanding. The obtained results, in addition to determine the effects of the input parameters, demonstrated the adequate mechanical properties of the produced parts in industrial scales and the validity of the proposed models. Also, the proposed method demonstrated its good capability for estimation of elastic modulus of powder metallurgy parts.