Sintering conditions govern the optimized functional properties of ceramics. However, solid-state processing of Bi1/2K1/2TiO3 (BKT), an important end member for lead-free piezoelectric solid solutions suitable for higher temperature (≤ 300 °C) transducer applications, is challenging due to the low melting temperature (≈1070 °C). In this work, the sintering temperature (1030 °C, 1050 °C, and 1060 °C) and dwell time (10 h, 20 h, and 40 h)-dependent functional properties of solid-state processed BKT were investigated, where the sintering condition-dependent dielectric and electromechanical properties were correlated with the variations in crystal structure and microstructure. Although X-ray diffraction data revealed a single-phase tetragonal structure of BKT at room temperature for all sintering conditions, significant changes in both the tetragonal distortion and spontaneous relaxor-ferroelectric transition were observed, which were directly related to the optimized functional properties. In addition, Rayleigh behavior of the piezoelectric coefficient was characterized between −150 °C and 400 °C, demonstrating that the electromechanical response is dominated by the intrinsic contribution, which can be explained by large tetragonal distortion and associated suppression of non-180° domain wall motion.