The quantities of low-grade reject fly ash (RFA) and paper sludge ash (PSA) generated are increasing annually and causing a serious social problem. In this study, the utility of these by-products was analyzed by using RFA and PSA as mineral admixtures. RFA-PSA blended mortar was fabricated and evaluated for use as a cement additive. RFA was milled to improve workability and the hydration reaction, and PSA was mixed with anhydrite to create the ettringite. As the RFA-PSA blended powder replaced 10% of the cement by weight, compressive strength of the mortar exceeded that of ordinary mortar prepared with Portland cement (OPC). Length change (28 days) of the RFA-PSA mortar with a 10% replacement rate was 68% of the OPC mortar and was 62% with a 30% replacement rate.