The aim of the present work was to characterize the mucilaginous components of psyllium seeds and evaluate it as a tablet binder. The seed gum was extracted and characterized in terms of physicochemical properties (swelling index, solubility studies, micromeritics properties, and test for polysaccharides, SEM and loss on drying), spectral analysis (FTIR, NMR, MS, PXRD) and bioburden analysis. Granules containing paracetamol as model drug were prepared by wet granulation using psyllium polysaccharide (PPS) and conventional binding agents (PVP K 30 and HPMC K 100M) separately and evaluated for flowability, strength and compressibility. Swelling index for PPS in phosphate buffer pH 6.8 was found to be 1572% whereas no swelling was observed in 0.5 M NaOH. The granules were found to have good flowability and compressibility as evident from the angle of repose and Carr's compressibility index. The Heckel constant for PPS was found to be in the range of 0.21-0.65 and yield strength was found to be1.53-4.62 psi. The tablets were also evaluated for hardness, friability, disintegration time and in vitro dissolution. They were found to have satisfactory tablet properties. Thus we may conclude that PPS can be used as a tablet binder and further studies may be undertaken to study its potential use as a multifunctional excipient.