Kaolinitic clays are potentially a vast domestic resource for aluminum. Utilization of this resource could decrease or eliminate the nearly complete dependence of the United States on foreign raw materials for this important metal. Furthermore, processing of clay to aluminum through anhydrous chloride metallurgy could reduce the high electrical energy requirements of the conventional hall-heroult aluminum reduction process. Several anhydrous chloride processes have been proposed; however, unresolved technical problems have prevented their commercialization. In particular, an acceptable chemical means has not been found to extract aluminum from clay as a highly pure anhydrous aluminum chloride. This Bureau of Mines report identifies and discusses the important chemical problems involved in achieving an acceptably rapid self-heating, selective chlorination reaction and the subsequent separation of iron chloride byproduct from the anhydrous aluminum chloride.