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A pellet mill is a type of mill used to create cylindrical pellets from a mixture of dry powdered feedstock, such as flour, sawdust, or grass, and a wet ingredient, such as molasses or steam. The pellets are made by compacting the mash or meal into many small holes in a die. The die is usually round and the pellets are pushed from the inside out. Pellet mills are used in the production of animal feeds, and of wood and grass fuel pellets for use in a pellet stove.

Pellet mills are unlike grinding mills, in that they combine small materials into a larger, homogeneous mass, rather than break large materials into smaller pieces. In this way, pellet mills are similar to extruders. Feedstocks for pellet mills can sometimes break down and then re-form, or polymerize, under the extreme heat and pressure of the pellet mill. Pressures in the "Die" can reach up to 25,000 psi.