To promote resourceful utilization of argon oxygen decarburization (AOD) slag, this research developed a new three-ash stabilized recycled aggregate with AOD slag, cement, fly ash (FA), and recycled aggregate (RA) as raw materials. The AOD slag was adopted as an equal mass replacement for fly ash. The application of this aggregate in a road base layer was investigated in terms of its mechanical properties and mechanistic analysis. First, based on a cement: FA ratio of 1:4, 20 sets of mixed proportion schemes were designed for four kinds of cement dosage and AOD slag replacement rates (R/%). Through compaction tests and the 7-day unconfined compressive strength test, it was found that a 3% cement dosage met the engineering requirements. Then, the unconfined compressive strength test, indirect tensile strength test, compressive rebound modulus test, and expansion rate test were carried out at different age thresholds. The results showed that the mixture’s strength, modulus, and expansion rate increased initially and then stabilized with age, while the strength and modulus initially increased and then decreased with increasing R. Secondly, based on X-ray diffraction (XRD) and scanning electron microscopy (SEM) used to analyze the mechanism, it was found that the strength, modulus, and expansion rate of the new material can be promoted by blending AOD slag, due to its ability to fully stimulate the hydration reaction and pozzolanic reaction of the binder. Finally, based on the strength and modulus results, R = 3% was identified as the optimal ratio, which provides a reference point for the effective application of AOD slag and RA in road base materials.