Diphasic Al2O3-SiO2 gel was synthesized by sol-gel route from inorganic salts following aqueous phase colloidal interaction and the effect of Cr2O3 additive on the formation of mullite ceramics from this diphasic gel was investigated. The gel powder was thoroughly characterized by chemical analysis, measurement of surface area, bulk density and FTIR spectroscopy. The calcined gel was compacted with Cr2O3additives in three different proportions (ca. 1, 2 and 3 wt) and heat treated at different elevated temperatures (ca, 1400, 1500 and 1600 c°). The analyses of microstructure and phase composition of the sintered masses were carried out by scanning electron microscopy and XRD technique. The morphology of the mullite crystals changed significantly in the presence of the additives. It has been observed that more than 7 more mullite has been formed with the addition of maximum 3 additive only. Using the additive, the maximum reduction in apparent porosity was about 30 and maximum improvement in density in the sintered compacts was about 14. The flexural strength and fracture toughness of the sintered compacts also improved by 16 and 6 respectively in the presence of the Cr2O3 additive under the experimental condition.