Solid-state nucleation of Si nanocrystals in a SiO2 bilayered matrix was observed at temperatures as low as 450 °C. This was achieved by aberration corrected high-resolution transmission electron microscopy (HRTEM) with real-time in-situ heating up to 600 °C. This technique is a valuable characterization tool especially with the recent interest in Si nanostructures for light emitting devices, non-volatile memories, and third-generation photovoltaics which all typically require a heating step in their fabrication. The control of size, shape, and distribution of the Si nanocrystals are critical for these applications. This experimental study involves in-situ observation of the nucleation of Si nanocrystals in a SiO2 bilayered matrix fabricated through radio frequency co-sputtering. The results show that the shapes of Si nanocrystals in amorphous SiO2 bilayered matrices are irregular and not spherical, in contrast to many claims in the literature. Furthermore, the Si nanocrystals are well confined within their layers by the amorphous SiO2. This study demonstrates the potential of in-situ HRTEM as a tool to observe the real time nucleation of Si nanocrystals in a SiO2 bilayered matrix. Furthermore, ideas for improvements on this in-situ heating HRTEM technique are discussed.