The microstructure and fracture characteristic of a pressureless-sintered (Si-Al-O-N)-6 wt% SiC composite have been investigated by a combination of transmission electron microscopy and microindentation fracture technique. SiC particles of nanometre size were dispersed in Si-Al-O-N grains and, at grain boundaries, were associated with strong strain fields. Si-Al-O-N grain boundaries were formed with an amorphous layer about 2 nm thick. However, interfaces between Si-Al-O-N and SiC embedded in the Si-Al-O-N grains were directly joined without any amorphous layer. The main fracture mode was an intergranular type, but some transgranular fracture by the dispersion of nanometre-sized SiC in the Si-Al-O-N grains are also observed at the crack wake zone. The fracture toughening mechanisms of crack deflection, bridging and microcracking were not observed in the (Si-Al-O-N)-6 wt% SiC nanocomposite system.