Waste management is becoming an increasingly urgent matter around the globe. The efficient management and recycling of waste products can contribute to environmental sustainability. Trillions of cigarette butts (CBs) are being littered every day around the world, amounting to one-third of the world’s littered waste. CBs contain mostly cellulose acetate-based fiber wrapped with paper along with many toxic compounds like burnt tobacco, tar, and heavy metals. Due to their non-biodegradable nature, CBs take years to decompose into the environment and leach out toxic chemicals into the environment in the process. Researchers have investigated different methods to recycle CBs in asphalt concrete and bitumen. The objective of this study was to investigate the rheological performance of CB fiber modified bitumen and the relevance of its application in stone mastic asphalt. The rheological properties like viscosity, complex modulus, and relationship with frequency, temperature, and phase angle were established, and the Linear Amplitude Sweep (LAS) test was performed to assess the fatigue damage resistance criteria of CB fiber modified bitumen. Stone mastic asphalt (SMA) was prepared with CB fiber modified bitumen, and the Marshall Stability and Flow of SMA was investigated and compared with the control sample prepared with conventional virgin cellulose fiber modified bitumen. The results from the test met industry standards and supported the use of CB bitumen in the construction of stone mastic asphalt.