Accurate quantification of crystalline phases present in drug materials is becoming increasingly important, due to stringent regulatory concerns about polymorph characterization and control in drug substances and products. In the present study, a quantification method for polymorphic forms of olanzapine (OLZ) has been developed using powder X-ray diffraction (PXRD). Preferred orientation has been reported to be the major source of error in PXRD analysis, therefore, prior to development of a quantification method, pure polymorphic forms (I and II) of different size ranges were analyzed. Preferred orientation effect was found to decrease on using sieve fraction BSS # 120/240 for form I. In order to obtain good peak resolution in optimum time, the step time and step size were varied so as to optimize the scan rate. Among the five combinations selected, step size of 0.05° with step time of 5 s demonstrated identification of four characteristic peaks of form I in form II in 62 min. A calibration curve was constructed in the range of 0–100% (w/w) using the characteristic peak of form I at 18.48° 2θ (I/I0 78.8%). The PXRD assay was reproducible and precise and displayed a LOD of 0.40% (w/w) and LOQ of 1.22% (w/w). Validation results showed excellent correlation between actual and predicted concentrations with R2 0.9999.