Due to increasing of traffic volumes and loading repetitions in combination with an insufficient degree of maintenance, surface distress like potholes, raveling of asphalt surface and rutting has been observed on most of the asphalt roads. In addition, increase in population with tremendous growth rate has led to disposal of large amount of nondecaying waste materials which become also a great concern in developed as well as developing countries. This study presents utilization of Waste Plastic Bag (WPB) as an aggregate coat and evaluates its effect on the mechanical properties of hot mix asphalt mixture with 9.5, 12.5 &19mm nominal maximum aggregate size. Therefore, in this investigation, cleaned, dried and grinded WPB (size ranges from 2.36 to 4.75mm) has been introduced randomly to the asphalt mixture at different percentage of WPB replacement content (i.e. 6, 9, 12, 15 & 18%) by the weight of optimum bitumen content. The specimens were subjected to Marshall Hot Mix Design and Indirect Tensile Strength (ITS) test. In total, 171 samples were prepared, 45 of which have been used to determine the optimum bitumen content, 54 specimens were used to study the effect of WPB, and the rest have been used to know the moisture susceptibility of the mix. The results indicate that WPB can be used in asphalt mixtures with the optimum replacement rate of 17, 13 and 7% for 9.5, 12.5 and 19mm nominal maximum aggregate size respectively. At the optimum WPB replacement stability, flow, bulk density and voids are within the local and international specifications. In addition, from ITS test it is observed that the modified mix doesn’t susceptible to moisture damage. For all nominal maximum aggregate size, based on the economic analysis using WPB in asphalt mix is economically viable. The asphalt mix produced with incorporating waste plastic bags are applicable on surfacing layers of flexible pavement structures. Asphalt mix with 9.5mm nominal maximum aggregate size modified with plastic bags can be used as surfacing layer for parking lots, 12.5mm can be used as wearing course layer and 19mm also can be used as binder coarse layer.