A re-circulating heat pump dryer (HPD) system was designed, constructed and tested at steady-state and transient conditions. Refrigerant 134a was used as a refrigerant in this system. The tests were performed to observe behavior of HPD system. So, changes of temperature and relative humidity of drying air through the dryer and heat pump operating temperatures were observed during the drying process and effects of by-pass air ratio (BAR) on the system's parameters as system performance and specific moisture extracted ratio (SMER) at steady-state were investigated. The HPD system was also tested to investigate temperatures and relative humidity changes of drying air during drying process on the system's parameters depend on time. Airflow rate circulated through the HPD system was 554 m(3)/h during the all tests. According to test results, the system's parameters did not change up to 40% of BAR. Then the coefficient at performance (COP) and SMER values were decreased after 40% of BAR. While SMER values changed between 1.2 and 1.4, COPsys changed between 2.8 and 3.3 depend on BAR. As well as during the drying process, the COP and SMER values were also affected and decreased depend on time.