Experiments were carried out to determine the effect of the dispersed phase concentration, phi, on the Sauter mean drop diameter of xylene in water in a mechanically agitated vessel. In the course of the experiments, the rheology of the dispersions was also measured. It was found that the viscosity of the dispersion exhibited strong viscous non-Newtonian characteristics for dispersed phase concentrations greater than approximately 50% by volume. The increase in the apparent viscosity of the dispersion with increasing dispersed phase concentration changed the how condition in the tank from turbulent regime to transitional and laminar flow regime. The Sauter mean drop diameter measured as a function of the dispersed phase was successfully interpreted in terms of a turbulent eddy-drop breakage mechanism for phi < 50% and by a boundary layer drop breakage model for phi > 50% by volume.