An improved method of producing anhydrous aluminum chloride via aluminum chloride hexahydrate. In a preferred embodiment the method is incorporated into a process for producing aluminum from aluminous ores, and particularly from domestic ore sources comprising (1) acid leaching an aluminous ore to produce aluminum chloride hexahydrate (ACH); (2) calcining the ACH to a specific temperature of above about 450oC to produce highly reactive aluminous particles containing high residual chloride and low residual hydrogen levels; (3) reductively chlorinating the calcined ACH at a low temperature to produce anhydrous aluminum chloride suitable for electrolytic reduction; and (4) electrolytically reducing the anhydrous aluminum chloride in a fused salt to produce aluminum metal and chlorine which is recycled to step (3).