The Malaysian construction sector contributes significantly to national development but also generates substantial amounts of construction and demolition (C&D) waste, leading to environmental degradation and resource depletion. This study investigates the key barriers that hinder the effective implementation of recycling practices among G7 contractors in Terengganu, a developing state experiencing growing construction activity. Using a structured quantitative survey, the study identifies seven critical barriers: lack of knowledge and awareness, low quality of recycled materials, high costs and complex procedures, insufficient recycling facilities and technologies, lack of enforcement, low market demand for recycled products, and limited policy implementation. Among these, the most significant barrier reported by respondents is the lack of education and awareness, followed closely by inadequate infrastructure and weak regulatory enforcement. These findings align with previous national studies but also highlight region-specific constraints that require targeted policy attention. The study concludes that promoting recycling practices in the construction industry demands a combination of multi-level governmental support, public-private collaboration, and comprehensive capacity-building programmes. Addressing these barriers is vital to advancing sustainable construction practices and achieving Malaysia’s broader goals under its circular economy and environmental sustainability agenda. The findings offer practical implications for policymakers, regulators, and industry stakeholders aiming to improve waste management in the construction sector.