Microstructural evolution and mechanical properties of gas-pressure-sintered Si3N4 with 4 wt% Yb2O3 as a sintering aid were investigated. The microstructure was not uniform throughout the specimen. Extremely large elongated grains were formed at the outer region near the surface, while relatively small elongated grains were formed at the inner region of the specimen. The outer region expanded inward with the sintering time. Mechanical properties, such as flexural strength, fracture toughness, and R-curve behavior of the specimens were strongly influenced by these variations in microstructure. The fracture toughness and the R-curve behavior of the outer region were higher than those of the inner region of the same specimen. On the other hand, the strength of the inner region was higher than that of the outer region. By controlling the relative thickness of each region, Si3N4 specimens having functionally graded microstructure were obtained. The Si3N4 with such microstructure exhibited high strength, high fracture toughness, and good flaw tolerance at the same time.