The influence of cryo‐ground rubber (CGR) on melt flow and mechanical properties of polypropylene has been investigated. Cryo‐ground rubber was incorporated in the polypropylene matrix (a) in powder form and (b) as masterbatch with natural rubber. Natural rubber was found essential as a dispersing agent. The loading of cryo‐ground rubber has no significant effect on viscosity at high shear rates (>61 s−1) but at lower shear rates (>61 s−1), viscosity functions change shape with increasing cryo‐ground rubber content. The dynamic mechanical properties revealed that polypropylene is thermodynamically incompatible with natural rubber and cryo‐ground rubber. Cryo‐ground rubber in the powder form shows poor adhesion to polypropylene matrix and, therefore, decreases the impact strength at higher loading. Addition of masterbatch of cryo‐ground rubber and natural rubber improves the impact strength of polypropylene. Copyright © 1986 Society of Plastics Engineers