Stress analysis in the compaction of ceramic powder was: performed by Finite Element Method (FEM) to predict the optimum conditions. In order to apply to practical problem, the powder bed was treated as elasto-plastic material, and the constitutive equation was derived from Drucker-prager＇s yield function expressed in terms of invariants of stress tensors and Hill＇s anisotropic parameters on stress in the powder bed. The powder bed has multiform bulk density distribution, along with behavior of discontinuous deformation during compression whereby, the mechanical characteristics of the powder hed change during compaction. Thus, it is necessary that the powder characteristics are treated as a variant associate with the progress of powder compaction. In this paper, Young＇s modulus and strain-hardening rate are expressed as a function of minor principal stress and strain. These function can be determined from a triaxial compression test. Hill＇s anisotropy parameters induced at compaction process were numerically obtained by simulation of the compacting behavior of particles which was performed by Particle Element Method (PEM). On the basis of the proposed constitutive model, the problem of powder compaction is analyzed. The calculated results of the nonlinear stress-strain relation, stress distribution during powder compaction agree well with the measured ones. It is shown that the procedure proposed here offer the useful information to decide the optimun conditions of powder compaction.