To provide a small and compact machine and its method that process identifying and counting of paper sheets such as paper money at high speed.

The paper sheet identifying and counting machine 10 carries the paper sheets along a carrying path 48 at high speed and processes identifying and counting of paper sheets by means of a paper sheet identifying and counting unit 63 provided in the middle of the path 48. The machine 10 has a hopper 15 to be supplied with the paper sheets, a paper sheet carrying device for feeding out the supplied paper sheets to the path 48 to carry them along the path 48 at high speed, a paper sheet identifying unit 63 provided in the middle of the path 48 for identifying and counting the paper sheets and a stacker 21 for stacking the paper sheets fed out from the path 48. The path has a U-shaped curved carrying path 48b in the middle of itself and has a reject carrying path 48d communicated with a pocket 20 from a downstream side carrying path 48c following the path 48b. The machine identifies at least 1200 paper sheets per a minute, being provided with a stacker 21 and a pocket 20.