In Shalimar Town (ST) and other areas of Lahore, sorting of waste is carried out by an informal sector comprised of junkyards, household waste collectors, street hawkers, and scavengers. This study explains the role of this informal sector in recycling of waste in eastern Lahore. People working in the informal sector belong to different socio-demographic and socio-economic groups. Recyclables are collected by males and females of all age groups. They are migrants, minorities, and poor refugees. Purchased and collected recyclables are later sold at slightly higher prices to junkyards located at different places in town. The total estimated quantity of recyclable material recovered by all junkyards working in ST is about 15.30 tons/ day and worth 681.8 €/day. People comprising the informal sector suffer from both health and safety issues during working hours because of their poverty. Not only is this informal sector helpful in reducing waste from highly populated urban areas of a third world country like Pakistan, but it also makes important economic contributions. Better results could be obtained if local government authorities improve the working environment for people working in the informal sector by providing better facilities for health care and environmental safety.