The aim of this study was to improve the bioavailability by enhancing the solubility of Efavirenz, a poorly water soluble anti-viral drug by using liquisolid technique. Different liquisolid formulations were prepared by using various non-volatile hydrophilic solvents. Microcystalline cellulose (Avicel PH 102) and Aerosil 200 were used as carrier and coating materials respectively. Additives such as Polyvinyl pyrrolidone, Hydroxypropyl methylcellulose and Hydroxypropyl Guar were incorporated into the formulations to improve dissolution characteristics. The prepared liquisolid compacts were evaluated for hardness, friability, weight variation, drug content and in-vitro dissolution studies. FT-IR studies were carried out to rule out the drug-excipient interactions. It was observed that there was no chemical interaction between the drug and excipients. DSC and X-ray diffraction studies were performed to evaluate the physicochemical properties of the liquisolid tablets, which enabled us to confirm the conversion of crystalline form of the drug to the amorphous form in the formulation. The dissolution profiles of liquisolid tablets were compared with that of the directly compressed tablets. The results obtained revealed that liquisolid tablets of efavirenz exhibited higher percentage of drug release than the directly compressed tablets.