This study evaluated the effect of incorporating crushed recycled plastic bottle caps (RPBC) as a partial volumetric replacement for fine aggregate in cement mortar. Fourier-transform infrared spectroscopy (FTIR) identified the recycled plastic as high-density polyethylene (HDPE), and particle size analysis indicated a median particle size (D50) of 3.17 mm. Three mortar mixtures were prepared: a control mixture without replacement and two mixtures containing 5% and 10% volumetric replacement of river sand with RPBC. All mixtures were produced using a local Type IP cement, a water-to-cement ratio of 0.50, and a polycarboxylate-based superplasticizer. At 28 days, the specimens were evaluated in terms of cylindrical compressive strength, flexural strength, ultrasonic pulse velocity (UPV), and crack propagation using Digital Image Correlation (DIC). Statistical significance was assessed through one-way analysis of variance (ANOVA) followed by Tukey's post hoc test. The results showed that incorporating RPBC reduced the mechanical performance of the mortar. Cylindrical compressive strength decreased from 33.11 MPa for the control mixture to 28.80 MPa and 28.55 MPa for the 5% and 10% replacement levels, corresponding to reductions of 13.02% and 13.78%, respectively. A similar trend was observed for flexural strength. Likewise, ultrasonic pulse velocity decreased by approximately 4–6%, indicating that the incorporation of recycled plastic reduced material compactness and increased internal heterogeneity. These reductions are attributed to the lower stiffness of HDPE particles and the weaker interfacial transition zone between the plastic particles and the cement matrix, which are consistent with trends reported in recent studies on recycled plastic aggregates. Overall, although the replacement of fine aggregate with recycled HDPE bottle caps reduced the mechanical performance of the mortar, the results suggest that low replacement levels may still be considered for non-structural cement-based applications, contributing to plastic waste valorization and promoting more sustainable construction materials.