The setting behavior of geopolymers is affected by the type of source materials, alkali activators, mix formulations, and curing conditions. Calcium hydroxide is known to be an effective additive to shorten the setting period of geopolymers. However, there is still room for improvement in the understanding of the effect of calcium hydroxide on the setting and phase evolution of geopolymers. In this study, the setting behavior and phase evolution of geopolymer containing calcium hydroxide were investigated by XRD analysis. The setting time of the geopolymer was inconsistently shortened as the amount of calcium hydroxide increased. A low calcium hydroxide dose of up to 2% of the total mix weight could contribute to the enhancement of compressive strength of geopolymers besides a fast-setting effect. The C-S-H gel is rapidly precipitated at the early stage of reaction in geopolymers containing high calcium hydroxide with some of the calcium hydroxide remaining intact. The ex-situ high-temperature XRD analysis and Rietveld refinement results revealed that geopolymer and C-S-H gel transformed into Si-rich nepheline and wollastonite, respectively. The wollastonite was also observed in heat-treated geopolymers with a low calcium hydroxide dose. It is believed that C-S-H gel can be precipitated along with geopolymers regardless of how much calcium hydroxide is added.