Polycrystalline layers of Si0.7Ge0.3 were deposited using low pressure chemical vapor deposition to a thickness of 500 nm on a n-type silicon wafer covered by SiO2. The Si0.7Ge0.3 layers were doped with different concentrations of boron by ion implantation. The morphology and electrical properties have been characterized using atomic force microscopy, transmission electron microscopy and Hall effect. Conductance fluctuations were measured at room temperature. Decreasing boundary scattering at higher free carrier density results in increased mobility. However, surprisingly enough, we found that the 1/f noise parameter α decreases with increasing mobility, which does not agree with the parameter α measured in crystalline semiconductor material grown by molecular beam epitaxy. The interpretation is that the noise is mainly generated in the depletion region of the grains, but the Hall mobility is reduced by the scattering at grain-boundaries. In this paper we present a detailed analysis to distinguish between 1/f noise from grain-boundaries, depletion region and neutral region of the grains. The 1/f noise in polycrystalline SiGe can well be analyzed in terms of mobility fluctuations in lattice scattering.