Commercial polymers have been used in pavement modification for decades; however, a major drawback of these polymers is their high cost. Waste plastic polymers could be used as a sustainable and cost-effective additive for improving asphalt properties, attaining combined environmental–economic benefits. Since 2019, in Australia, trial segments of roads have been built using waste materials, including plastic, requiring that laboratory evaluations first be carried out. This study aims to examine and evaluate the effect of using a domestic waste plastic, polyethylene terephthalate (PET), in modifying C320 bitumen. The assessment of several contents of PET-modified bitumen is carried out in two phases: modified bitumen binders and modified asphalt mixtures. Dynamic shear rheometer (DSR) and rolling thin film oven tests (RTFOT) were utilised to investigate the engineering properties and visco-elastic behaviour of plastic-modified bitumen binders. For evaluating the engineering properties of the plastic-modified asphalt mixtures, the Marshall stability, Marshall flow, Marshall quotient and rutting tests were conducted. The results demonstrated that 6–8% is the ideal percentage of waste plastic proposed to amend and enhance the stiffness and elasticity behaviour of asphalt binders. Furthermore, the 8% waste PET-modified asphalt mixture showed the most improvement in stability and rutting resistance, as indicated by increased Marshal stability, increased Marshall quotient and decreased rut depth. Future fatigue and modulus stiffness tests on waste plastic-modified asphalt mixtures are suggested to further investigate the mechanical properties.