Closed-loop recycling means a material is recycled back into the same or similar product—like turning an old cotton T-shirt into new cotton fabric for another shirt. The material stays within the same product system and keeps its original quality and function.

Open-loop recycling, on the other hand, turns a material into something different—like using polyester clothing to make insulation or carpet padding. The material is still reused, but it’s typically turned into a lower-value product and may eventually end up as waste.