Red soils are prevalent in India, covering over 10% of the total land mass. The traditional clay burnt bricks made of these red soils consume a lot of energy and releases toxic constituents into the environment during their manufacturing process. On the other hand, the steel industry's ground granulated blast furnace slag is creating a lot of environmental concerns regarding disposal and storage aspects. In light of this, an effort was made in the utilization of magnesia activated GGBS (GM) to produce stabilized earth blocks which consumes less energy, is economically viable and increases the recycling of GGBS. Besides, the utilization of these stabilized earthen blocks can be more affordable in low cost housing. In present study, the changes in physical, strength and microstructural properties at different binder percentages of 3, 6, 9, 12 and 15% were studied. The compressive strength increased with increase in GM concentration and curing period. The minimum compressive strength of 15% GM blended samples at 28 days of curing is 3.5 N/mm2 and the density is 1820 kg/m3, which meets the minimum strength and density standards of Grade A(3.5) as per IS (Part1):2005 of 3.5 N/mm2 and 1500 kg/m3 respectively. Moreover this paper provides the possible utilization of magnesia activated blast furnace slag stabilized blocks as a building material.