The compound exists in three levels of hydration corresponding to different crystallographic structures and to minerals: The main use of calcium sulfate is to produce plaster of Paris and stucco.

With judicious heating, gypsum converts to the partially dehydrated mineral called bassanite or plaster of Paris.

The equation for the partial dehydration is: The endothermic property of this reaction is relevant to the performance of drywall, conferring fire resistance to residential and other structures.

In a fire, the structure behind a sheet of drywall will remain relatively cool as water is lost from the gypsum, thus preventing (or substantially retarding) damage to the framing (through combustion of wood members or loss of strength of steel at high temperatures) and consequent structural collapse.

But at higher temperatures, calcium sulfate will release oxygen and act as an oxidizing agent.

In contrast to most minerals, which when rehydrated simply form liquid or semi-liquid pastes, or remain powdery, calcined gypsum has an unusual property: when mixed with water at normal (ambient) temperatures, it quickly reverts chemically to the preferred dihydrate form, while physically "setting" to form a rigid and relatively strong gypsum crystal lattice: This reaction is exothermic and is responsible for the ease with which gypsum can be cast into various shapes including sheets (for drywall), sticks (for blackboard chalk), and molds (to immobilize broken bones, or for metal casting).

The conditions of dehydration can be changed to adjust the porosity of the hemihydrate, resulting in the so-called α- and β-hemihydrates (which are more or less chemically identical).

γ-Anhydrite reacts slowly with water to return to the dihydrate state, a property exploited in some commercial desiccants.

These precipitation processes tend to concentrate radioactive elements in the calcium sulfate product.

The retrograde solubility of calcium sulfate is also responsible for its precipitation in the hottest zone of heating systems and for its contribution to the formation of scale in boilers along with the precipitation of calcium carbonate whose solubility also decreases when CO2 degasses from hot water or can escape out of the system.