Due to their structural features and natural water content, scaly clays are being used in Sicily in the construction of core earth dams and waste isolation fills. A reliable design of the earth constructions requires the characterisation of the behaviour of the compacted scaly clay in unsaturated conditions. Experimental data from oedometer tests on compacted samples, in suction controlled wetting-drying cycles are presented. The compacted specimens swell moderately upon wetting, but they experience a relevant irreversible volume reduction upon the first drying. The overall behaviour appears to result from the structural arrangement of the compacted material. The interpretation of the oedometer data is supported by a microstructure study, performed by both SEM and MIP investigations. The study provides a first insight in the role of the natural microstructure features of the clay on its overall response