The effect of binding liquids-water, alcohol and mixtures of the two on the pelletisation of three materials of differing solubility in water or alcohol-lactose, paracetamol and phenacetin was studied. It was found that the high solubility of lactose in water is not the only parameter affecting pellet growth properties but it is also the greater wetting of lactose particles due to surface tension lowering by alcohol in water-alcohol mixtures. Paracetamol pellets prepared with water were small and weak but those prepared with alcohol or water-alcohol mixtures were larger and of a greater strength due to the greater solubility of paracetamol in alcohol relative to that in water. Phenacetin when pelletised with water, alcohol or water-alcohol mixtures were very soft and fragile. This suggests that for very hydrophobic material such as phenacetin, it is not sufficient to be highly soluble in alcohol but solubility in water is essential.