Mechanical ball milling is the most common method for mixing ceramic powders with a ductile phase such as metal particles. In this paper, a new powder processing way is presented. Al2O3 and TiC powders are coated with a layer of metal cobalt using the chemical deposition process. The thickness of the metal cobalt film can be controlled by adjusting the deposition conditions. The Co-coated Al2O3 (Al2O3-Co) and TiC (Tic-Co) powders are mixed at the rate of 7:3 and hot-press sintered into a fine Al2O3-TiC-Co (ATG) ceramic. The main properties, erosion behaviour, abrasion behaviour, wear mechanism and wear resistance of Al2O3-TiC-Co and Al2O3-30 wt % TiC (AT(30)) ceramics are determined by transmission electron microscopy, scanning electron microscopy, energy dispersive X-ray spectroscopy, etc, it is shown that the ATC ceramic possesses improved mechanical properties. Because of the existence of metal cobalt in the grain boundaries, the bonding strength between grains is increased, and this prevents spalling of grains during wear. Experimentation indicates that ATC is more resistant to wear than Al2O3-TiC ceramic. The relationship between their mechanical properties and wear resistance is also discussed in this paper.