It is well known that mechanical properties of mechanically recycled waste plastics are very low. The reason has been believed to be chemical degradation with polymer chain scission. However, we had clearly shown that the reason for the low mechanical properties was physical deterioration due to changes in internal structure. And we had also shown that the physical degradation can be regenerated by selecting the appropriate polymer processing. Among these regeneration processing methods, the method using a twin-screw extruder with having a new apparatus "molten resin reservoir" is epoch-making advanced processing method because we can keep using a conventional process as it is and the production speed. Because of this feature, this method has attracted a great deal of attention in new mechanical recycling research and has been incorporated into a project of Japanese government. In this time, we discuss the mechanism of physical degradation and regeneration from the memory effect of crystalline polymers. In particular, we will show that the structure built by the pelletizing process remains after injection molding and affects the mechanical properties of the product. And also we will introduce the overview of the Japanese project.