The Al-SiC system has been used as a model system in an examination of phase stability in the presence of a liquid phase and microstructure development in metal-matrix composites. The Al-Si-C phase diagram has been calculated for temperatures between 500°C and 1500°C. The phases formed between Al(liquid) and SiC at 920°C have been determined experimentally, using analytical electron microscopy, in both fiber and particulate composites and compared with what is predicted from the equilibrium phase diagram. The morphologies and the spatial distributions of phases have also been examined in addition to the phase analysis. The only phases found were Al, Al4C3, SiC, and Si. Although Al4SiC4 is calculated to be stable at 920°C, it was not found. The SiC grain structure was found to influence strongly the morphology of the Al4C3-SiC and Al-SiC interfaces.