This study assesses the changes in physical properties (particle size, shape, density) of Austrian pine (softwood) and European beech (hardwood), as they are mechanically processed from wood chips to pellets and then to milled pellets. A series of semi-industrial hammer mills and a semi-industrial pellet mill were used. The specific pelletizing and grinding energy, as well as the pellet mill and hammer mill capacity, were determined. Size, shape, and bulk density of the wood particles obtained at each processing step were studied. The pellet quality was analyzed according to international standards. Results show that the pelletization modifies the internal pellet particle shape and length due to the breakage of particles across their longest dimension, leading to more circular and less elongated particles. However, the particle width was nearly unaffected, indicating a directional fracture behavior for wood particles during pelletization.The particle breaking effect was more dominant for beech particles. Beech contained a lower amount of extractives than pine that led to higher specific pelletizing energy. In addition, beech Masche et al. / Mechanical processing pathway of wood / 2 pellets had a lower quality concerning durability and density. Relationships between specific grinding energies and characteristic product particle sizes were also determined. E.g., the specific energy for grinding pine pellets was about 10 kWh/t oven-dry wood for a characteristic product size of 0.8 mm, while grinding beech pellets required about 7 kWh/t oven-dry wood for a characteristic product size of 0.6 mm. The study concludes that less energy is needed to pelletize pine than beech under the same processing conditions, but more energy is needed to mill pine than beech.