Carbothermal reduction and nitridation of aluminium hydroxide was investigated by weight-loss measurement and X-ray diffraction. Experimental results indicated that aluminium hydroxide was first dehydrated to aluminium oxide and then reduced and nitrided to aluminium nitride. Aluminium oxynitride and Al2O were found to be intermediate products. The reaction rate was found to be increased by increasing the nitrogen flow rate, the molar ratio of C/Al(OH)3, or reaction temperature. The rate was also found to be increased by decreasing the sample size, the grain sizes of carbon or aluminium hydroxide or initial bulk density. Empirical rate expressions of the conversion of Al(OH)3 and carbon, as well as the yield of AIN, were also determined.