Inclination shallowing of detrital remanent magnetization in sedimentary strata has solely been constrained for the mechanical processes associated with mud deposition and shallow compaction of clay-rich sediment, even though a significant part of mud diagenesis involves chemical compaction. Here we report, for the first time, on the laboratory simulation of magnetic assemblage development in a chemically compacting illite shale powder of natural origin. The experimental procedure comprised three compaction stages that, when combined, simulate the diagenesis and low-grade metamorphism of illite mud. First, the full extent of load-sensitive mechanical compaction is simulated by room temperature dry axial compression. Subsequently, temperature controlled chemical compaction is initiated by exposing the sample in two stages to amphibolite or granulite facies conditions (temperature is 490 to 750°C and confining pressure is 170 or 300 MPa) both in the absence (confining pressure only) and presence of a deformation stress field (axial compression or confined torsion). Thermodynamic equilibrium in the last two compaction stages was not reached, but illite and mica dehydroxylation initiated, thus providing a wet environment. Magnetic properties were characterized by magnetic susceptibility and its anisotropy (AMS) in both high- and low-applied field. Acquisition of isothermal remanent magnetization (IRM), stepwise three-component thermal de-magnetization of IRM and first-order reversal curves were used to characterize the remanence-bearing minerals. During the chemical compaction experiments ferrimagnetic iron-sulphides formed after reduction of magnetite and detrital pyrite in a low sulphur fugacity environment. The degree of low-field AMS is unaffected by porosity reduction from 15 to ∼1 per cent, regardless of operating conditions and compaction history. High-field paramagnetic AMS increases with compaction for all employed stress regimes and conditions, and is attributed to illite transformation to iron-bearing mica. AMS of authigenic iron-sulphide minerals remained constant during compaction indicating an independence of ferrimagnetic fabric development to chemical compaction in illite shale powder. The decoupling of paramagnetic and ferrimagnetic AMS development during chemical compaction of pelite contrasts with findings from mechanical compaction studies.