In this work,solid-state reaction method and a two-step sintering procedure were successfully used to prepare neodymium-doped yttrium aluminum garnet (Nd:YAG) transparent dielectric ceramics. The effects of the microstructure and crystal structure of the ceramics on the microwave dielectric properties were investigated. Samples after vacuum sintered at 1600–1750^∘C and further hot isostatic pressing (HIP) at 1700^∘C had a pure YAG phase. The cell volume increased slightly after further HIP treatment compared to the vacuum-sintered ceramics. Combined with the disordered arrangement of the atoms in the HRTEM image,the lattice expansion could be explained by the entrance of larger ions into the YAG lattice. Moreover,the sintering drive provided by HIP could effectively eliminate the porosity in ceramics,increase the average grain size,and narrow the grain boundaries,which was conducive to the improvement of transmittance and quality factor (Qf) value. Finally,the sample that was vacuum sintered at 1700^∘C and then exposed to HIP had outstanding microwave dielectric characteristics: ${\epsilon }_r=10.64$,$\mathrm{\text{Qf}}=515,800$$$GHz and ${\tau }_f=-21$$$ppm/^∘C.