A hydrophobic gypsum composition is provided which contains gypsum, a granulated hydrophobing additive and a pH effecting additive in an amount sufficient to maintain the pH of the composition in the range of 8 and 12.5, in the presence of water. The granule contains an organopolysiloxane having silicon bonded hydrogen, a water soluble or water dispersible binder, and a carrier, preferably gypsum or a stearate salt, in an amount sufficient to hydrophobe the gypsum. The pH effecting additive is preferably lime but may be any appropriate additive.