Filling a polymer with particulate material is generally attempted to improve the polymer properties and also realize some reduction in the cost. In the present work, we attempted to study the viability of using fly ash, an industrial waste with good mechanical properties, as a filler in epoxy. Initial low volumes of filler display an improvement in compressive strength and modulus. The experimental values of strength and modulus are also found to correlate well with those predicted by the rule of mixtures and modified Kerner's equation. At higher volume fractions, the decline in these properties is explained in the context of both percolation theory and Griffith's theory. The processes of failure initiation and propagation proposed are examined from the viewpoint of observations on the surfaces of compress ion-failed samples in SEM.