With the rapid development of manufacturing technology powder compaction has been a highly-developed forming technology for manufacturing net shape or near net shape parts with complex geometries and special mechanical performances. An experimental and numerical investigation was made to study the densification behaviors during powder compaction. A series of compaction tests were carried out. A numerical model using multi-particle finite element model (MPFEM) was presented for densification analysis, particles were discretized with fine elements for precise description of inter-particle interactions, and three initial packing structures (hexagonal, tetragonal, and random) were considered in the numerical model. The simulation results of the multi-particle finite element model with random packing structure were in good agreement with experimental results, and can give further insight into the particle-level densification mechanism behind the macroscopic phenomenon in physical compaction tests. Particles' flow behavior, stress field and energy conversion, that are related to the particle rearrangement, contact interactions and local plastic deformation, were detailed analyzed with the numerical model. The effects of friction, particle size and compacting velocity on compaction densification were discussed, and response surface studies of inter-particle friction, particle size and compacting velocity were completed for compaction process optimization.