Abstract: A method of producing laminated veneer lumber (LVL) with good dimensional stability, characterized by a particular lay-up of the veneers and the veneers being of at least two different wood species. The particular veneer lay-up and species arrangement, minimizes the tendency of warping and cracking of the LVL. All veneers are laid-up in pairs by species with the loose sides of each pair contacting each other and with the species pair sequence from face to core being identical on either side of the center ply or center line. The veneer tight faces of different species are bonded to one another. The dimensional stability of the LVL is optionally enhanced by a water repellent, flow promoter and bulking agent that is incorporated into the adhesive before application onto the veneer. The different species veneers are dried to different moisture contents before lay-up with the denser species being of lower moisture content than the less dense species.