Al-substituted ZnO is a potential high temperature n-type thermoelectric material. The thermoelectric properties, the morphology and the microstructure of Zn0.98Al0.02O prepared by soft chemistry synthesis were studied and compared with samples synthesised by solid state reaction. The soft chemistry method produces samples with better connectivity of the grains and less structural defects leading to a lower electrical resistivity and a higher thermal conductivity than solid state reaction. The Seebeck coefficient is not affected by the microstructure of the material. The highest value of the dimensionless Figure of Merit ZT of 0.21 is therefore reached at 1275 K for the samples from soft chemistry synthesis.