Wood–plastic composites (WPCs) present a class of materials originally developed to decrease the dependency on the mineral oil-based plastics. However, additives and coupling agents incorporated in these composites are usually derived via synthetic routes. The effect of hardwood distillate (HWD) on the properties of WPC was determined by adding various amounts (1–8 wt%) of distillate to a commercial WPC consisting of thermally treated saw dust (Scots pine) in a polypropylene matrix. The distillate was derived by converting hardwood (birch) into several liquid fractions in a two-part slow pyrolysis retort. The certain addition of particular HWD enhanced the tensile and flexural properties of the WPC studied. Furthermore, the water absorption of the samples decreased substantially, up to over 25%. Proton-transfer reactor time-of-flight mass spectrometric analyses indicated that the addition of the distillate increased the emission rates of studied volatile organic compounds (VOCs) but had no considerable effects on the emission rates of VOCs that are harmful for humans. The conversion of the emission rates into real room concentration revealed that guaiacol and monoterpenes exceed their odor thresholds and therefore can be smelled from the WPCs studied. The findings of this study show that this particulate HWD displayed good potential as an ecological additive in WPCs.