We investigated the effect of small amounts of ammonium sulfate (NH4)2SO4 on compound fertilizer granulation. We examined the following raw materials: humic acid, ammonium chloride, urea, potassium chloride, and monoammonium phosphate. The mass ratio of organic matter, nitrogen, phosphorus, and potassium was typically 22:17:7:2. In the absence of (NH4)2SO4, the granulation rate of the compound fertilizer was low, and increased significantly following the addition of 1–2% (NH4)2SO4. We suggested the following physical and chemical processes as potential mechanisms: (NH4)2SO4 promoted the conversion of yellow flue gas desulfurization gypsum into gypsum whiskers; (NH4)2SO4 interacted with humic acid and urea to generate a new complex; urea sulfate was formed under acidic conditions. The combined effect of the above physical and chemical processes was an increase both in the rate of interactions between the materials and in system viscosity, which has the end result of increasing the granulation rate.