Cordierite-mullite composite ceramics were prepared by solid-state method using Panzhihua low-grade Ti-rich clay, talc, and alumina. Influences of cordierite/mullite ratio, sintering temperature, and the chemical composition of clay on the phase composition, microstructure, physical properties, and thermal properties were investigated in detail. The results showed that the impurity oxides inside the Ti-rich clay had a great ability of forming liquid. Above 1300 °C, the reaction between TiO2 of the clay and Al2O3 produced stable Al2TiO5, which was conducive to decreasing the coefficient of thermal expansion (CTE). At 1300–1350 °C, the secondary mullitization caused the volumetric expansion, decreasing the bending strength and increasing the CTE. The optimum ratio of cordierite to mullite ranged from 90:10 to 80:20, and the sample fired at 1400 °C exhibited the lowest water absorption and porosity (0.64 % and 1.56 %, respectively), optimal bulk density, and bending strength (2.59 g cm−3 and 87.79 MPa), as well as better CTE, thermal conductivity, and thermal storage density (2.91 × 10−6 °C−1, 4.11 W/(m⋅K) (30 °C), and 1181 kJ kg−1, respectively). Compared with the reported values of cordierite-based thermal storage ceramics prepared by using the high-grade clay or minerals, the obtained samples showed the advantages such as lower costs for raw materials, higher bending strength, higher thermal conductivity (1.63–2 times higher), low CTE, and high thermal storage density. This study demonstrated that the low-grade Ti/Fe-rich clay has excellent cost-effective potential for the preparation of thermal storage ceramics.