In this study, thermoplastic polyurethane (PU) composites were successfully prepared from waste cotton fabric (WCF) and reclaimed PU foam derived from the shoe manufacturing industry through melt mixing. A pan-mill-type mechanochemical reactor made in our laboratory was applied to determine the mechanochemical activation of WCF. The intramolecular and intermolecular hydrogen bonds of WCF could be broken up through pan milling because of the fairly strong shearing and squeezing forces. Moreover, the simultaneous reduction of particle size and the large increment of the specific surface area of pan-milled WCF benefitted its dispersion and the interfacial adhesion with the PU matrix. Mechanochemically activated WCF could be used as a low cost but effective functional additive to enhance the melt processability and mechanical properties of PU/WCF composites. With the addition of 75-phr WCF, the heat shrinkage of the melt-reprocessed PU decreased sharply from its original 11.4 to 0.3%. Meanwhile, the tensile strength of the composites was enhanced from 10.3 to 23.2 MPa. (c) 2012 Wiley Periodicals, Inc. J. Appl. Polym. Sci., 2013