The invention discloses a powder circulating crushing and grading production line, and belongs to the field of powder processing. The powder circulating crushing and grading production line comprisesa ball mill, a conveying pipeline, a grader and a material returning device, wherein a discharging opening of the ball mill is connected with the grader through the conveying pipeline and a pipeline bend; a coarse material outlet of the grader is connected with the material returning device; the material returning device comprises a material returning pipeline, one part of the material returning outlet on the material returning pipeline is covered with a fixed blocking plate, the other part of the material returning outlet on the material returning pipeline is covered with a movable blocking plate, and the movable blocking plate is connected with the fixed blocking plate through a hinge and can only move towards the outside of the outlet of the material returning pipeline. The powder circulating crushing and grading production line is used for powder processing, greatly reduces the abrasion and reduces the iron content of powder products through structural improvement.