This article examines the impact of environmental legislation on sustainability that manifests through the conservation of natural resources and landfills. The developed model is implemented to a real world closed-loop supply chain with recycling activities of electrical equipment in Greece. The motivation behind this research is to examine whether the environmental legislation should be considered as an endemic process of the system under study or introduced without considering the "Limits" issues. We adopt System Dynamics methodology applied to many environmental systems. Numerical analysis illustrates that the consideration of the endemic process and the expansion of the environmental regulations in order to include also measures for the products' recyclability and recycled content improves significantly the efficiency of the environmental legislation on sustainability. 1 Introduction In 1970 Forrester presented the ''equilibrium run'' of his world model (Forrester, 1971) to members of the Club of Rome. He stated that stabilizing production at levels compatible with the limited environmental capacity of our planet is essential to avoid overshoot and subsequent decline in the world system. Later, the Brundtland commission changed Forrester's "equilibrium" into "sustainable development" (Angell and Klassen, 1999).