Now a days the use of concrete is increased due to the rapid growth of construction industry especially in the urban areas. Concrete, being an essential building material, has gained significant attention in the construction industry worldwide. Colloidal silica is a potential material to improve various concrete properties such as workability, strength and durability. The percentage addition of colloidal silica in concrete has become an important topic of research these days due to its beneficial effects on concrete strength enhancement. This study aims at to evaluate the effect of colloidal silica addition and replacement with cement by weight on the compressive strength of M40 Grade concrete. The strength of concrete is affected by various factors such as water cement ratio, the type of aggregate, cement and the admixture. The effect of colloidal silica on workability, density and compressive strength of M40 grade concrete was studied in the present study using colloidal silica of type CS-TX. Colloidal silica is a Nano material that has been widely used in the recent years. Colloidal silica of (CS–TX) type is replaced and added with cement at various percentages like 1.0, 1.5, 2.0, 2.5 and 3.0% respectively to study the improvement in compressive strength of M40 grade concrete. Use of Colloidal silicaincreases the compressive strength by reducing the voids in the concrete. Experimental results indicate that 2% of Colloidal silica is optimum for replacement of cement and 2.5% of Colloidal silica is optimum content for addition of cement in M40 grade concrete.