An inspection and sorting machine and a related method of operation are provided. The inspection and sorting machine includes an inspection system that outputs a first signal corresponding to a fastener condition and a second signal corresponding to an inspection condition. Based on the inspection system output, a controller determines whether a fastener is classified as conforming or whether the fastener is classified as undetermined. Conforming fasteners are diverted into a conforming parts chute, and undetermined fasteners are diverted into a recirculated parts chute. The remaining fasteners are diverted into a reject chute. The undetermined fasteners are recirculated into the inspection and sorting machine for re-inspection.