Lignin, the second most abundant biopolymer on earth following cellulose, can be described as a million-ton, low cost, under-utilized resource. The use of lignin in polymeric products adds the highest value to the raw material. Production of engineering plastics from lignin is an attractive approach to the utilization of lignin. The use of lignin in structural materials is limited by its insolubility and its failure to undergo melt flow. A promising method to overcome the limitations is to chemically modify lignin by reaction with a low modulus substance, like an aliphatic ether. The reaction of lignin with propylene oxide (PO) produces a copolymer, hydroxypropyl lignin (HPL). Extensive studies have been directed toward the understanding of the chemistry and properties of HPL. A study of the process design is necessary to examine the economics of lignin propoxylation. This work includes the chemical and kinetic analysis of the lignin propoxylation reaction as well as the modelling of a semibatch polymerization process; the design of a lignin propoxylation pilot plant; and a preliminary study of an industrial plant. Two models for the lignin propoxylation reaction are proposed and analyzed to produce a mathematical description of the reaction process. The design of the pilot plant involves (a) the process design, which includes a material balance, a flow sheet, and a listing of the equipment; and (b) the economic analysis in which estimates of capital cost and operating costs are discussed. The scale-up to industrial production gives an estimate of the characteristics of a continuous process. This study constitutes a substantial contribution to the development of a new technology dealing with Engineering Plastics from Lignin. / Master of Science