Recycling of aluminum chips by hot extrusion is a metal forming technique, which requires considerably less energy than conventional recycling by remelting. The aluminum chips sorted by alloy type were first chemically washed in a mid-alkaline bath and then completely dried in an industrial furnace, compacted to billets, heated up to extrusion temperature and directly extruded into finished products without remelting. This method utilizes not only significantly less energy compared to conventional recycling by remelting but also prevents the material loss that is typical in remelting of fine aluminum scrap in the form of chips.The main aim of this research was to investigate hot extrusion of aluminum chips including principles of operation, process technology and equipment, and to develop this process further by solving the encountered problems to allow its application in industry. First the effect of extrusion process parameters on the microstructure and mechanical properties of the profiles recycled from chips was investigated. It was shown that the extrusion parameters like extrusion ratio, die design and the billet temperature predominantly define the properties of the recycled profiles. The mechanism of chip welding during aluminum extrusion was investigated using the analysis of the microstructural evolution. Based on the analytical solutions for the problem of longitudinal seam weld formation, a new approach was developed to analyze the welding of the aluminum chips. The boundary conditions for sound chip welding can be defined using the proposed analytical approach as well as with the help of simulations using the finite element method (FEM). A welding-quality-index (WQI) is introduced to define the chip welding quality under given process conditions, which can be used to quantitatively evaluate the success of recycling aluminum chips by hot extrusion. An innovative process design utilizing a closing cap and a new punch design was developed to eliminate the formation of air blisters during hot extrusion of chips.