Cyclophosphamide is a nitrogen mustard alkylating agent from the oxazophorines group. The primary metabolite of cyclophosphamide (CP, 1), i.e . 4-hydroxy-CP 2, has high pharmacological activity, but it is a very unstable compound. During processing and storage of the dry powder formulation, a glassiness or stickiness could be acquired by the premix composition giving an unattractive material with inferior solubility characteristics and decreased potency. This deterioration was more pronounced if it exceeds normal storage temperature. In this present exertion sufficient data on cyclophosphamide characterization is provided and the sorption-desorption studies were performed to comprehend the hygroscopicity temperament of the drug. Cyclophosphamide was characterized using powder x-ray diffraction, differential scanning calorimetry and thermogravimetry. Characterization data lend a hand in identifying and understanding the physical properties of the drug. The water sorption-desorption profile provides key information related to the physical stability of solid forms, especially hydrates (Cyclophosphamide). We scrutinized the moisture uptake of samples at various relative humidity and temperatures using gravimetric methods and can fully characterize the drug. Sorption-desorption studies were performed using gravimetric vapour sorption technique and found the critical factors in storage and stability of the drug.