Abstract: Waste rubber containing carbon black is broken down in size into small pieces, purged of air and then fed into a retort, likewise purged of air and continuously rotated or oscillated about its longitudinal axis. The retort is maintained at a temperature ranging between 275.degree. F. and 1000.degree. F., and preferably ranging between 500.degree. F. and 850.degree. F., to produce rubberized carbon black consisting of particles of carbon, each particle encapsulated in a sphere of rubber of 1-60 microns in diameter.Rubberized carbon black can be compounded with virgin rubber or polymer such as scrap high density polyethylene or both virgin rubber and polymer, and can then be formed into various shapes having useful and valuable physical, mechanical and thermal properties.