This study investigates sustainable mortars using lightweight synthetic sand (LSS), made from dune sand and recycled PET bottles, to replace natural sand (0-100% by volume). This aligns with circular economy principles by valorizing plastic waste into a construction aggregate. LSS is produced via controlled thermal treatment (250 +/- 5 degrees C, 50-60 rpm), crushing, and sieving (<= 3.15 mm), leading to a significantly improved interfacial transition zone (ITZ) with the cement matrix. The evaluation included physico-mechanical tests (density, strength, UPV, dynamic modulus, ductility), thermal properties (conductivity, diffusivity, heat capacity), porosity, sorptivity, alkali-silica reaction (ASR), and SEM. The results show LSS incorporation reduces mortar density (4-23% for 25-100% LSS), lowering material and logistical costs. While compressive strength decreases (35-70%), these mortars remain suitable for low-stress applications. Specifically, at <= 25% LSS, composites retain 80% of their strength, making them ideal for structural uses. LSS also enhances ductility and reduces dynamic modulus (18-69%), providing beneficial flexibility. UPV decreases (8-39%), indicating improved acoustic insulation. Thermal performance improves (4-18% conductivity reduction), suggesting insulation applicability. A progressive decrease in sorptivity (up to 46%) enhances durability. Crucially, the lack of ASR susceptibility reinforces long-term durability. This research significantly contributes to the repurposing of plastic waste into sustainable cement-based materials, advancing sustainable material management in the construction sector.