The invention provides a pollution-free recycling method of iron-based grinding waste material, belonging to the technical field of circular economy, and more particularly relating to the green circulating and recycling technology of the iron-based grinding waste material in the metallurgy industry. The recycling method of the iron-based grinding waste material comprises the steps of removing oil, heat treating, sieving and proportioning to obtain the iron-based alloy powder which can be used for an SHS lining steel tube, a powder metallurgy structural component, magnetic grinding and thermalspraying. The invention has the recovery rate of the iron-based alloy powder more than 95%, and the characteristics of wide raw material source, low cost, no secondary pollution, high circulating andrecycling rate and wide powder use.