Setting time and strength of sulphoaluminate rapid hardening cement (SAC) incorporated in the presence and absence of silica fume (SF) were determined. Combined with the techniques of" isothermal calorimeter, XRD and FSEM, the hydration kinetics of the two systems and the effect mechanism of SF on SAC were investigated. The experimental results showed that SF was proved to be beneficial for SAC system, in terms of setting time and late strength gain. Evidence of accelerator effect of silica fume was found during the first 8 hours of hydration. The formation of AFt was accelerated and the microstructure of the hydration products grew denser with incorporation of SF. SF was proved to play the role of dispersion and setting control at early age and had a greater contribution to later strength due to the increment of crystal nucleation point and the pozzolanic activity. Therefore, SF can be used to not only control the hydration kinetics of SAC, but also develop the late strength and improve the microstructure.