In this paper, a parametric experimental study developing the alkali-activated slag concrete hollow block (AASCHB) is discussed. Fourteen trial mixes of alkali-activated slag concrete containing pottery sand and ceramsite with different water-to-slag ratios, sand ratios, silicate moduli, and Na2O contents were evaluated to determine the optimal mix for high compressive strength and low drying shrinkage. All four factors evaluated were found to be significant for the desired properties. A series of 390 × 190 × 190 mm3 AASCHBs were prepared using the optimal mix with a water-to-slag ratio of 0.35, sand ratio of 0.64, silicate modulus of 1.2, and Na2O content of 8%. The compressive strength, flexural strength, water absorption, and moisture content tests of these blocks indicate that the resulting AASCHB can be classified under the strength grade of MU15 as a load-bearing hollow concrete block. The proposed AASCHBs appear to provide a viable solution to the environmental problems of industrial waste and cement production emissions, leading to more sustainable buildings without compromising structural performance.