This research delves into the critical issues surrounding soap usage, with a focus on addressing challenges related to skin health, environmental sustainability, and individual well-being. Furthermore, the production and disposal of soap can contribute to environmental problems, including deforestation and water contamination. The emergence of pathogens underscores the importance of effective soap formulations. Additionally, exploring the financial and personal benefits of soap-making reveals potential challenges due to variable costs. To address these concerns, the study employs the Taguchi design of experiment (DOE) method to optimize soap formulation. This involves a comprehensive analysis of mechanical properties such as pH, moisture content, foaming, and antimicrobial features, along with an examination of production costs. User satisfaction is assessed through a Hedonic Test questionnaire. The soap development process includes formulating soap with agarwood essence and sawdust, conducting tests for moisture resistance, pH, foaming, and applying the Taguchi Method for optimization. Antibacterial activity is evaluated through microbial growth tests, and user satisfaction is assessed through the Hedonic Test. This systematic approach aims to enhance soap formulation by considering both technical aspects and user preferences, promoting improved quality and acceptance. The results obtained from this research encompass a broad spectrum of analyses. This study uses diverse analyses for soap evaluation. Hedonic evaluations gauge user preferences on its sensory aspects. Psychochemical analysis explores how chemical properties affect soap's texture and efficiency. Foam and pH analyses assess lathering quality and skin safety, respectively. Microbial analysis confirms antibacterial potency. Cost analysis ensures affordability, while moisture analysis impacts texture and shelf-life. Taguchi analysis optimizes the formula, and regression analysis elucidates factor effects on quality. These combined analyses aim to develop a soap that's enjoyable, effective, and cost-effective. These thorough results contribute to a holistic understanding of the soap's sensory, chemical, functional, and economic attributes. In turn, they facilitate informed decisions for further improvements, ultimately promoting the overall well-being of users and the environment.