Epoxy resin (EP) is a widely used thermosetting resin. However, its cross-linked structure poses a big challenge for recycling into value-added products. This study advanced the recycling of acid anhydride-cured epoxy using solid-state shear milling (S3M) technology. Through this process, the C–C backbone and C–O cross-linking bonds in epoxy resins were destroyed, generating C═O and −OH reactive groups in the reactive epoxy resin powder (REP). When REP-20 (number of milling cycles) is incorporated as an active filler into the original curing system, the tensile strength of the epoxy resin increased from 34.2 to 51.6 MPa, and the flexural strength increased from 57.1 to 82.3 MPa, which were 50.1 and 44.1% enhancement, respectively, compared to REP-1. Futhermore, REP powder can serve as an active filler into epoxy resin with other curing agents, such as curing agent 593 and 4,4-Diaminodiphenylmethane (DDM). By employing REP powder to enhance surface roughness in hydrophobic coating, a contact angle increased 144.1°. Additionally, when REP was utilized in a filter column, it effectively separated water and oil with a separation efficiency of up to 99%. After 10 cycles of operation, the flux and filtration efficiency of the devices remained unchanged, demonstrating excellent stability and reusability. This study provided a new way to recycle thermosetting resins to produce value-added functional fillers for applications such as hydrophobic coatings and oil–water separation.