Ultrafine $Mg(OH)l_2$and MgO powders were recovered from the waste solution containing $Mg^{++}$ which was a by-product of SHS (Self-propagating High temperature Synthesis)process. The optimum experimental conditions to prepare $Mg(OH)_2$were 13.0 of pH and 0.7M of $Mg^{++}$ content with addition of 9M of KOH as a pH regulator in acid leaching solution. Complete pre-cipitation of Mg(OH)$_2$from $Mg^{++}$ was realized at that condition. The dehydration reaction of the prepared Mg(OH)$_2$was studied by DSC, and the result was used for calcination process. In order to obtain MgO powder, dried Mg(OH)2 powder was calcined at $400~450^{circ}C$. Particle size and shape of the prepared $Mg(OH)_2$and MgO powder was similar to those of the commercial powders.