Yttrium aluminium garnet powder with nanocrystallite can be successfully synthesized by co-precipitation method from a mixed solution of yttrium nitrate and ammonium aluminium sulfate using ammonium hydrogen carbonate as a precipitant. Effects of yttrium-to-aluminium ratio, reaction temperature, pH of the reaction, precipitation processes and variation of calcination time on phase formation, structure and morphology of YAG powder were investigated. Generally, it was found that precipitates which were calcined for 2 h at 1200°C would completely become YAG. With the increasing calcination temperature, the secondary particles are formed by the sintering of primary particles which can be partially broken up by milling. The reverse strike process conducting at relatively low reaction temperature with the Y-to-Al molar ratio at stoichiometric ratio of 3:5 is proper to form YAG phase. When the pH is controlled at 7 during the precipitation process, it was found that the pure YAG phase without any intermediate phase occurs by the direct transformation of amorphous to YAG after calcined 900°C or higher. Furthermore, many factors of precipitation condition affect size and size distribution of the powder, including the speed of mixing, the rate of addition and the concentration of precursors. Fabrication of synthesized YAG powder was also investigated and compared with commercial YAG powder. The compacted bodies were sintered at 1650°C for 5 h in air. The relative density of the sintered specimens were in the range of 91-92 % of theoretical density.