The economics and physics of plutonium recycle in the Calder Hall type reactor are considered. Three possible schemes of recycle are studied. In scheme A the plutonium produced in a run is blended with fresh natural uranium for a subsequent run; in scheme B the plutonium is alloyed with some diluent metal and fabricated into high heat-transfer elements more like MTR- or PWR-seed type elements and a subsequent load of fresh natural uranium elements is “spiked” with these plutonium elements; and in scheme C half the spent uranium is recycled as well as the plutonium. The conclusions are that scheme A will be the most economic means of recycle and will compete very favorably with the mode of operation where the plutonium is sold at the end of each run for $12 per gm. Viewed in another way, with natural uranium having its current value and lease charge, the fuel value of plutonium for recycling, with all costs considered, will be greater than $12 per gm. Schemes B and C do not look as attractive as A for the Calder Hall type reactor. The results are predicated on the assumption that the fuel elements will withstand exposure levels as high as 8800 Mwd/ton. This is beyond present experience, but it is believed that it is not unrealistic to assume that such exposures will be achieved in the future with improved fuel elements. A matrix-analytic solution to the differential equations governing isotopic concentrations as functions of flux-time is also developed.