The granules used in powder compaction processes must have homogeneous morphology and the appropriate breaking strength. Hence, in order to control the morphology and breaking strength of granules, it becomes important to clarify their formation mechanisms. In the present study, the relationship between the morphology of spray-dried granules and drying conditions has been investigated by using numerical simulations. A simulation method for the drying of particulate suspensions has been developed by combining a distinct element method (DEM), which is used for analyzing particle behavior, with a constrained interpolation profile (CIP) method, which is used for analyzing gas-liquid multiphase flow. The particle motion and gas-liquid flow during the drying of droplet-suspended particulates are calculated at various air temperatures using this simulation method. A hollow granule is formed, and enlarges when the air temperature and drying rate are increased. When the drying rate is increased, particles begin to crust into a droplet surface early; moreover, the shrinkage of the crust is stopped earlier than under the condition of low drying rates. The gas-liquid interface then enters the crust. In this manner, a hollow granule is formed. We then perform simulations of the drying of a suspension droplet with different drying rate distributions on the droplet surface. A depression is formed at the granule surface at the part with low drying rate; in contrast, in the case of the part with the higher drying rate, the crust is formed rapidly and the gas-liquid interface begin to invade into the crust earlier. A capillary force arises and a liquid pressure decreases in the crust, and then the liquid flows according to the pressure gradient. Because particles are transferred with the liquid flow, the crust partially collapses inward, while depressions are formed in the granule.