Steam granulation (SG) involves the use of steam as the granulating medium instead of traditional liquid water [1]. Steam provides a higher diffusion rate into the powder bed and a more favourable thermal balance during the drying step. Due to the ability of the steam to diffuse, a reduction of up to 50% of the amount of water necessary for granulation is possible. Furthermore, the literature reports that the granules produced by SG have a larger surface area than those obtained with wet granulation (WG) [2]. However, no articles have been published on the effect of steam on the compressibility characteristics of the granules. The purpose of this study was to compare the technological properties of granules and their relative tablets obtained with SG and WG. To evaluate the effect of the solubility and thickening power of the diluents on process performance, different formulations were used containing 20% (w/w) caffeine as a model drug, 50% (w/w) microcrystalline cellulose as granulating aid and 30% (w/w) diluent (maltodextrin, sorbitol, lactose or corn starch) were used. The preliminary rheological characterizations performed on the four formulations highlighted that SG requires a lower amount of liquid binder than conventional WG; moreover, SG generally allows better control of granule growth because it occurs more slowly than WG. Granulation experiments were performed using a standardized experimental procedure, and the granules, after drying in a ventilated oven, were characterized by sieve analysis to evaluate the particle size distribution and by measuring the tensile strength and uniformity of the content. A compression study was also performed to identify the compression mechanism. The granules obtained with SG are generally smaller, with a narrow particle size distribution and lower crushing strength. The granules were then compressed in a single punch tablet machine using different compression forces, and the tablets that had a tensile strength of 1-2 MPa were characterized by mass and content uniformity tests, disintegration and dissolution tests. The results demonstrate that the granules manufactured through SG have better compression properties and the tablets present shorter disintegration time and a faster caffeine release than those achieved through WG. [1] S. Shanmugam, Granulation techniques and technologies: recent progress. BioImpacts (2015) 5 (1) 55-63. [2] M. Vialpaldo, B. Albertini, N. Passerini, D. Bergers, P. Rombaut, J.A. Martens, G. Van Den Mooter, Agglomeration of mesoporous silica by melt and steam granulation. Part I: A comparison between disordered and ordered mesoporous silica. Journal of Pharmaceutical Sciences, 102 (2013) 3966-3977.