The ordinary fine aggregate in concrete has been replaced by ground and sieved steel slag fine aggregate, treated and exposed to air for three months. Compared with concrete made from natural sand, properties such as compressive strength, flexural strength, elastic modulus, permeability and abrasion resistance are considerably improved. The improvement increases with a decrease in w/c ratio, an increase in curing time and an increase in the replacement weight of sand. These results are due to the fact that the steel slag contains some active minerals such as C3S, C2S, C4AF, etc., and shows favorable surface physical characteristics that improve the bond between steel slag particles and cement paste. The results of XRD, SEM and EPM microhardness showed that there are heavier concentration of ions, with finer crystals and a lower degree of CH orientation at the interfacial zone between steel slag particles and cement paste. The study also found small cementitious and fibrous C-S-H crystals growing from the fine aggregate, which are linked with hydrated products from cement paste making the bond and structural characteristic more favorable with cement. The steel slag fine aggregate is an active mineral similar to cement. The bond between the aggregate and cement paste is strengthened both physically and chemically.