Using bio-based chemicals and recycling waste plastics are essential components of the circular economy. Wood−plastic composites (WPCs), fabricated from recycled plastic and wood-processing wastes, are new, green, and environmentally friendly materials. However, their flammability causes potential fire risks and hazards. Although bio-based flame retardants possess the essential advantage over inorganic or petroleum-based chemicals, their application, particularly that of fully bio-based flame retardants, in WPC has been seldom reported. Herein, we designed and synthesized a fully bio-based flame retardant, phytic acid-tyramine salt (referred to as PATA), using a green and environmentally friendly approach with only deionized water as the reaction solvent. PATA is subsequently utilized in conjunction with ammonium polyphosphate (APP) to synergistically impart flame-retardant properties to WPCs. PATA/APP shows a good flame-retardant effect, improving the flame retardant and smoke suppression properties of WPCs. The PATA/APP system can increase the limiting oxygen index by 31% and achieve a vertical combustion V-0 rating. Furthermore, the PATA/APP system can reduce the peak heat release rate, total heat release, and maximum smoke density by 49, 22, and 15%, respectively. The PATA/APP system can generate phosphoric acid substances during combustion, which promote the decomposition of wood flour to form stable char layers containing P−N−C or P−O−C structures. Consequently, we provide an environmental-friendly approach to enhance the flame retardancy of WPCs.