The potential use of waste-expanded polystyrene (EPS) beads in the production of lightweight screed mortar (LSM) was investigated. LSM specimens were produced by replacing waste EPS with normal weight aggregate at 20%, 40%, 60%, 80%, and 100% proportions by volume. Workability, unit weight, capillarity, flexural and compressive strength, abrasion resistance, drying shrinkage, and thermal conductivity of the LSMs were determined. Waste EPS replacement by the normal weight aggregate reduced the abrasion resistance and strength properties of LSMs.  Waste EPS also caused the LSMs to have lower unit weight and thermal conductivity, significantly. It was concluded that substitution of waste EPS by normal weight aggregate up to 60% can be proposed for adequate strength and heat-insulating properties of LSMs. LSM produced with 60% waste EPS (M60) has 16.3 MPa 28th-day compressive strength with 0.4562 W/m.K thermal conductivity and 1.35 g/cm3 unit weight.  Moreover, the recovery of waste EPS contributes to both reducing environmental pollution and storage problems.