This paper reports the strength development in alkali-activated clay (AAC) synthesised from untreated and calcined low grade clays. The effects of clay calcination and the temperature adopted in different curing regimes on the mechanical properties of AAC were studied from a microstructural viewpoint. Solid-state MAS NMR, FTIR, EDS, and TEM imaging were used for the microstructural studies. Calcination of the clay resulted in an increase in the 7-day compressive strength of AAC from 31.7 MPa to 47.8 MPa. 29Si MAS NMR results indicated that ratio of Q4(2Al) percentage to Q4(4Al) percentage correlates positively with the compressive strength. Curing the AAC at higher temperatures resulted in higher strength, but there was a conflict between strength development due to ongoing polymerisation and strength deterioration due to post-curing crack propagation. FTIR results indicated the formation of a more polymerized structure and stronger bonds in the AAC as a result of calcination. In addition, FTIR showed a higher Si–O bond strength in AAC cured at a higher temperature, which positively correlated with the compressive strength of the specimens. EDS and TEM results revealed the presence of a silicon-rich phase in AAC synthesised from the untreated clay. This sodium silicate gel exhibited poor hydrolytic stability which could result in long term durability issues.