A briquetting machine for loose metal scraps comprises a pre-extrusion part, a re-extrusion part and a final pressing part. On the upper portion of a pre-extrusion cavity (14) of the pre-extrusion part, a pre-extrusion releasing area (15) is formed near to one side of a re-extrusion cavity (24). At the front end of a re-extrusion plunger (23) of the re-extrusion part, a lateral gap (28) is formed near to one side of the pre-extrusion cavity. The cross section of the lateral gap is a right-angled trapezoid and the lateral gap is provided with a lateral slope (29). A briquetting method for loose metal scrapes is disclosed. By way of pre-extrusion and step-by-step feeding and triggering resetting loading, not only is a certain pre-pressing effect guaranteed while the loose metal scraps are processed in each feeding and pre-pressing step, but also the stress can be transferred and released timely under the over-pressure condition, which avoids the formation of dense metal block under the over-pressure condition. Therefore a continuous, automatic and safe pressing operation is assured.