An efficient cost-effective process for preparation of 1-erythro-2-amino-1-phenyl-1-propanol from 1-1-phenyl-1-hydroxy-2-propanone, which comprises converting 1-1-phenyl-1-hydroxy-2-propanone to 1-1-phenyl-1-hydroxy-2-propanone oxime and reducing the oxime with a catalyst consisting of finely divided nickel and aluminium metals giving good diastereomeric purity and yield.