A synthetic clay mineral Laponite has been reported to undergo chemical degradation when dispersed in aqueous media causing magnesium ions from the same to leach out. This work systematically studies chemical degradation of Laponite particles in aqueous dispersions preserved under ambient air as a function of concentration of Laponite as well as that of externally added salt (NaCl). Along with measurement of concentration of magnesium ions using complexometric titration, pH and ionic conductivity of the dispersions are also measured at regular interval. Interestingly, for the studied dispersions, pH of a dispersion does not have any direct effect on chemical degradation of Laponite. Increase in concentration of Laponite as well as that of salt, on the other hand, is observed to have stabilizing effect against degradation. Finally a chemical stability phase diagram is proposed which indicates dispersion having higher concentrations of Laponite and salt are more stable. Conversely, with increase in time elapsed since preparation, Laponite particles in dispersion are more prone to degradation. The experimental data is analyzed to investigate mechanism of degradation and site of hydrogen ion attack on the Laponite particles.