Direct catalytic upcycling of solid plastic waste is challenging owing to its chemical robustness, and existing conversion routes often require harsh conditions or costly catalysts. Here, we develop a circular plastic-to-catalyst-to-product strategy converting waste poly(ethylene terephthalate) (PET) bottles into a microwave-responsive composite catalyst for microwave-assisted catalytic plastic upcycling. First, microwave-assisted PET depolymerization and Ni-MOF nanorod crystallization generate abundant missing-cluster defects, inherited during pyrolysis as lattice-distorted Ni nano-cores and edge dislocations encapsulated within a defective carbon shell (Ni@C). These strain-rich Ni─C heterointerfaces enhance dielectric loss and interfacial polarization under microwave irradiation, promoting local microwave energy dissipation at catalyst-plastic contacts and accelerating peroxymonosulfate (PMS) activation. Coupled microwave-thermal-chemical PMS activation initiates polymer-chain disordering, hydrogen abstraction, and C─C bond scission in high-density polyethylene (HDPE) particles before oxidative functionalization, making it more efficient than oxidation-dominated hydrothermal heating. Spectroscopic and strain-mapping analyses reveal that dislocation-rich Ni cores and carbon defects govern microwave energy dissipation and thus catalytic oxidation reactivity. The optimized Ni@C catalyst achieves up to 96% degradation of HDPE and converts products into valuable liquid hydrocarbons and oxygenates with limited phytotoxicity. Overall, this work integrates waste-derived catalyst design with microwave-assisted plastic conversion, offering a route toward circular plastic upcycling and carbon recovery.