Compaction can severely impair soil structure, which may in turn affect shrinkage properties. The few studies that have so far investigated compaction effects on soil shrinkage behavior have produced seemingly inconsistent results, reporting an increase, decrease, or no change in shrinkage. The objective of this study was therefore to examine the changes in soil shrinkage under controlled laboratory conditions across a wide range of compression. We analyzed shrinkage curves of repacked aggregated soil recorded at increasing levels of uniaxial compression after conditioning to different initial water potentials. With increasing compression, the shrinkage curves changed from a sigmoidal shape typical for structured soil to the simple shape typical for unstructured soil such as a clay paste, indicating the loss of structural pores. The slopes of the shrinkage curves were less steep in the structural and basic shrinkage domains at moderate compression than in the uncompressed initial state, indicating a strengthening of interaggregate bonds and thus an increase in hydrostructural stability. The highly compressed soil, in contrast, showed distinctly steeper slopes, indicating decreased hydrostructural stability due to the breaking of interaggregate bonds. The compression effects on the shrinkage curves became more pronounced with increasing initial water potential during compression. This strong dependence on the degree of compression and initial water potential may be one reason for the variation of compaction effects on soil shrinkage properties reported in the literature. The results show that soil shrinkage is well suited for the assessment of soil structural stability and compaction effects on structured soil.