In accordance with the Circular Economy Package of the European directive, the Spanish government compels manufacturers of plastic bags to include into their products a minimum of 70% of polyethylene (PE) waste. Following this mandate can be challenging and requires a deep knowledge of the alterations produced by the recycling in the main components of a plastic bag film: lineal low-density polyethylene (LLDPE), the LLDPE recycled post-industry, generated as waste from an industrial process (rLLDPE) and the PE recycled from post-consumer use (rPE), that has been picked up, cleaned, and reprocessed. This study provides insight in the macro and microstructural changes produced by several cycles of recycling in these materials. Specimens in the form of film for supermarket bags formed with these polymers have been subjected to several recycling sequences. The process closely mimics industrial processes. Four cycles have been applied to the samples. The evolution of mechanical properties, including tensile strength, elongation at break, and tear and impact tests, shows an obvious decrease due to degradation that is not an impediment for practical use after the four cycles of recycling according to the main specifications defined by the producer. Colorimetric measurements reveal no significant variations in the color of the films. The results of the FTIR and TGA analysis show degradation phenomena and changes in crystallinity in branching and the apparition of crosslinking that are in consonance with the mechanical data. There is also a difference between both types of recycled PE. In general, rLLDPE is more affected by the recycling than rPE. According to our findings, the limiting property would be the tearing. By comparing these values with bags available in the market, manufactured from 70–80% recycled material, we can infer that while two reprocessing cycles can lead to good results, a maximum of four cycles of recycling is advisable