Abstract: In electrolytic production of magnesium metal the concentration of magnesium chloride in the bath is required to be replenished periodically or continuously. This magnesium chloride should be anhydrous and of certain specifications.This invention provides a method for the production of such anhydrous magnesium chloride in a two-stage dehydration of magnesium chloride solution, the first step consisting of preparation of a fine powder from magnesium chloride with 0.5 to 1.5 molecules of water and about 4 to 10% magnesium oxide with or without alkali or alkaline earth metal chlorides, or both depending on the starting material. This first step is carried out in a conventional apparatus like the spray drier, briquetting the above partially dehydrated product in admixture with carbon powder under pressure to obtain compacted material such as briquettes of bulk density of 0.6 to 1.3 g/c.c., and size 1.5 to 5 cm. Second step comprises heating the above briquettes to a temperature of 200.degree. to 350.degree. C.