In this work, (Fe,Cr)(3)Al matrix nanocomposite reinforced by 47 vol.% Al2O3 was synthesized by mechanochemical reaction of Cr, 3Al and Fe2O3 powders mixture. The structural evaluation of powder particles during milling was done by X-ray diffraction (XRD), scanning electron microscopy (SEM), transmission electron microscopy (TEM) and differential thermal analysis (DTA). The results showed that at the early stage of milling, the thermite reaction between Fe2O3 and Al occurred and Fe and Al2O3 phases were formed. Then, the remaining Al and Cr were alloyed with Fe, leading to (Fe,Cr)(3)Al-Al2O3 nanocomposite structure. Further investigations indicated that the presence of diluents (excess Al and Cr) did not change the modality of thermite reaction and the formation of (Fe,Cr)(3)Al-Al2O3 nanocomposite proceeded with combustion process. The (Fe,Cr)(3)Al-Al2O3 nanocomposite powder exhibited the hardness value of 1140 Hv which is significantly higher than 935 Hv obtained for (Fe,Cr)(3)Al. (C) 2013 The Society of Powder Technology Japan. Published by Elsevier B.V. and The Society of Powder Technology Japan. All rights reserved.