Ponded fly ash is a unique sediment, exhibiting distinct particle and bulk-scale characteristics compared with natural sediments. A recently completed EPRI-funded laboratory study focused on assessing the fundamental geotechnical engineering properties of fly ash and its behavior in ash disposal ponds. For this study, samples of ponded and dry fly ash were obtained from several electric utilities and subjected to extensive characterization. Laboratory test results help discern the distinguishing physical and chemical characteristics of ponded fly ash and lead to the identification of potential pitfalls in using standard geotechnical correlations and analyses. Importantly, short-term aging is observed in some fly ash specimens. This early diagenesis is readily detected by shear wave velocity and has a marked effect on self-weight consolidation, which alters the contractive/dilative tendency of fly ash subjected to shear. In most cases, "water pluviated and immediately loaded" fly ash specimens tend to dilate upon shear at low to moderate confining stresses anticipated in ponds of moderate depth. These tendencies are contrary to those of materials prone to static liquefaction, a phenomenon that has been attributed to ponded fly ash. Results from this testing program help guide the design of proper field characterization studies and are relevant to the selection of strategies for "closing" existing fly ash ponds. This paper and presentation will examine the mechanism of diagenesis of these materials and the significant effects of diagenesis on the engineering performance of materials in fly ash ponds.