The Recycler is a way to make the duplicate clothes or My Room items you have useful. You can exchange them for new clothing and My Room items or sell them for coins or diamonds. You can find the Recycler in the bottom right of the Oasis Lobby to the right.
Tap on the Recycler to open it. On the right hand side of the Recycler window, you can see all the duplicate items you own. The items are sorted by their star rating.

Tap on a duplicate to place it in the Recycler. Once you’ve placed four duplicate items into the Recycler, tap to activate it and you will pay a small fee. In return, you’ll get an item with a star rating one above the four items you just recycled. If you have a lot of items that you want to recycle, the Recycler allows you to recycle 40 of them at a time. The higher the star rating of the items you recycle, the more likely you are to get a 5-star one.
You can also merge items in the recycler.