Gwalia Gold Mine is located 3 km south of Leonora in the north eastern goldfields of Western Australia. Historically, gold grade at Gwalia has been estimated using ordinary kriging. This approach requires the definition of hard-boundaries to properly constrain mineralisation zones, in order to assume a practical degree of stationarity. The process is subjective and imposes continuity on mineralisation that is not necessarily supported by geological evidence. Localised reconciliation can be improved by applying a method that is strongly aligned with the underlying Geology. Throughout the Gwalia orebody, there is a well-established direct relationship between alteration type, veining and gold. Indicator kriging appears as an attractive alternative for this style of mineralisation. Consequently, Indicator kriging has been applied to the South West Branch lode component of the Gwalia deposit based on the detailed logging of these attributes. Results from this process are highly consistent with geological observations and have resulted in improved grade estimation. The advantage of this approach is the elimination of internal hard-boundaries imposing continuity of mineralisation. Indicator kriging does not rely on arbitrary geological interpretations (straight lines over several metres), but rather uses probabilities based on an underlying geology model highlighting the critical importance of soundly based geological observations. CITATION: Maturana, F J and Browne, C, 2019. Gold grade estimation using alteration-based indicator kriging at Gwalia Mine, Western Australia, in Proceedings Mining Geology 2019, pp 161171 (The Australasian Institute of Mining and Metallurgy: Melbourne).