Phase transition form α' to β' and grain shape change due to chemical instability have been investigated in the Y-Si-Al-O-N system during liquid phase sintering. $78Si_3N_4-14AlN-8Y_2O_3$ (wt.%) powder compacts have initially been sintered at 1700℃ for 24h under 3 atm $N_2$ gas pressure to make α'-sialon with large grain size (mean grain diameter of approx.5 m). The sintered body has been resintered at 1700℃ for 32h under 3.5 atm $N_2$ in a liquid bath of $14Si_3N_4-4AlN-41Al_2O_3-41Y_2O_3$ (wt.%) composition, which corresponds to a equilibrium composition with β'-sialon. During resintering the liquid phase has penetrated into the sintered compact. α'-phase has transformed into β'-phase through grain coarsening by dissolution and reprecipitation process of the material through the matrix and 12H sialon polytype has been formed between the liquid phase and the sintered body. In the liquid, YAG ($3Y_2O_35Al_2O_3$) phase has been precipitated and grown dendritically during solidification of the liquid. Many β'-grains have been abnormally grown and have 'internal structures' which probably original β'-grain shape. Three dimensional observation of abnormally grown β'-grains reveals faceted hexagonal prismatic planes and rounded basal plane. Formation of non-regular curved interfaces between abnormally grown β'-grains has been explained by chemical instability provided by surrounding liquid matrix to the system.