The environmental problems associated with raw poultry manure application could be mitigated by stabilizing its nutrient and organic matter (OM) contents by composting before application to agricultural soils. In the present study, quantitative changes in physical, chemical, and microbial properties of poultry litter (a mixture of poultry manure, wood shavings, waste feed, and feathers) were studied in order to understand the composting process and evaluate the suitability of the composted product as a soil amendment. The poultry litter was composted in forced-aeration piles. Results of this study showed that the poultry litter went through physico-chemical and microbial changes similar to other composting systems, including changes like self-heating of the compost mass, relative increases in total Cu, Zn, P, K, and NOx−-N and decreases in microbial population numbers, C, OM, and extractable C, Cu, Zn, and NH4+-N contents. Despite differences in thermophilic temperatures at different locations of the forced-aeration piles, temperatures in these locations reached ambient level almost at the same time by day 128, indicating that the poultry litter was becoming stable. Nitrogen loss was a major problem during composting of poultry litter, even when the piles were not turned under the forced-aeration system. About 18 kg of the initial N (58% of the initial N) was lost during composting, which indicates that composting reduced the value of the poultry litter as N fertilizer. However, the composted litter contained a more humified (stabilized) OM compared with the uncomposted litter, which could enhance its value as a soil conditioner. In conclusion, composting of poultry litter converted the soluble nutrients to more stable organic forms, thereby reducing their bioavailability and susceptibility to loss when applied to crop fields.