The rapid expansion of construction, fueled by industry and economic and population growth, has exacerbated the challenge of managing construction waste, especially concrete waste. One promising solution lies in the utilization of recycled fine aggregate (RFA), especially in combination with the emerging geopolymer technology, an innovative alternative to traditional cement. This study systematically explores the effects of incorporating varying qualities and quantities of RFA into geopolymer mortars. By using GGBS and FA as raw materials and replacing natural aggregates (NA) with RFA at different rates (25%, 50%, 75%, and 100%), the research investigates the fresh properties, mechanical characteristics, and drying shrinkage of geopolymer mortar. Key findings reveal that RFA significantly influences the flowability of geopolymer mortar: when RFA content is above 75%, preprocessed RFA (with particles below 0.15 mm removed) has substantially improved flowability, increasing it more than 20%. The critical impact of RFA preprocessing on enhancing mechanical properties and the higher the inclusion level (above 75%), the more pronounced is the advantage in enhancing the compressive strength compared to unprocessed RFA. Additionally, RFA was found to contribute to a denser interfacial transition zone (ITZ) than natural aggregate, which helps maintain the compressive strength at increased RFA dosages. Contrary to findings in cement mortar, a positive correlation exists between pore volume and compressive strength in geopolymer mortar incorporating RFA. This study underscores the potential of refined RFA preprocessing methods in advancing sustainable construction, highlighting avenues for the broader application of RFA in geopolymer mortar.