The effect of a rubber mould on densification behavior of aluminum alloy powder was investigated under cold isostatic compaction. A thickness of rubber mould and friction effect between die wall and rubber mould were also studied. The hyperelastic constitutive equation based on the Ogden strain energy potential was employed to analyze deformation of rubber. The elastoplastic constitutive equation of Shima and Oyane and that of Lee on densification were implemented into a finite element program (ABAQUS) to simulate densification of metal powder for cold isostatic pressing and rubber isostatic pressing. Finite element results were compared with experimental data for densification and deformation of aluminum alloy powder under isostatic compaction.