Drying shrinkage in mortar produces cracks and micro-cracks which affect the durability of a structure. The effects of seawater as a substitute to freshwater and fly ash as a partial replacement for cement were investigated in this study in order to address the predicted water shortage by 2025 and the increasing carbon footprint from carbon dioxide emissions worldwide. Moreover, these materials are also more economical alternatives to freshwater and cement. Rectangular prism specimens with varying fly ash content (10%, 15%, 20%, 25%, and 30%) were cast to measure the drying shrinkage in mortar while 50-mm cube mortar specimens were prepared to determine the compressive strength. This study investigated whether the addition of fly ash and seawater reduced the drying shrinkage of mortar. From the results, it was found that mortar specimens with 20% fly ash replacement achieved the highest early and late strengths. Partial substitution of fly ash would result to shrinkage in mortar while substitution of seawater to freshwater counteracts the effects of fly ash, thus producing less shrinkage. Fly ash content between 20%-25% combined with seawater produces the least shrinkage value without compromising the minimum required compressive strength.