A series of beta-SiAlONs with the composition Si6-zAlzOzN8-z (z = 0.5-4) is prepared by hot isostatic pressing. Evaluated bulk moduli are compared with those calculated using the first-principles method. Theoretical values are derived from the fit of the energy versus volume dependence. In total-energy calculations full relaxation of all atomic positions within a supercell is performed. Both experimental and theoretical bulk moduli compare reasonably well and show the decrease in value from similar to240 GPa (z = 0) to similar to170 GPa (z = 4). For the ON substitutions no preferential occupation of the lattice N sites is observed. Both Al/Si and ON substitutions cause the local expansion of the structure. In the relaxed structures a sphere of decreased interatomic distances surrounds each substitution site, thus compensating for effect of the local expansion. The increasing Al-O/Si-N substitution rate causes a smooth change of the shape and position of the energy bands. The band gap between occupied and unoccupied states is getting narrower, thus decreasing the isolating properties of the material.