On deposition, plasma-sprayed ceramics are typically far from thermodynamic equilibrium, i.e., they contain metastable phases and also exhibit an extremely high density of lattice and other defects at many microstructural levels. Exposure to high temperatures is known to result in a consolidation of the material and can lead to both subtle and radical changes in the meso and microstructure. The effective elastic properties must be governed by the variety of structural defects and must also change as the defect structure changes during annealing. In the present study the microstructural development in plasma-sprayed alumina (Al2O3), as a function of annealing temperature is investigated using techniques of electron microscopy, X-ray diffraction and porosimetry. In addition, the effective elastic properties of this material have been studied using an ultrasonic spectroscopy technique which is especially suited for porous, highly attenuating materials. The results show that annealing even at moderate homologous temperatures already has a noticeable effect on the elastic properties. Upon annealing at higher temperatures, very strong elastic constant changes are observed: increases of about 300% as compared with the as-sprayed material. The underlying microstructural changes are discussed in detail. It is found that the elastic properties of plasma sprayed alumina must be largely governed by the aspect ratio and arrangement of internal defects and porosity.