Oxide dispersion strengthened Fe-Cr alloys produced by mechanical alloying and spark plasma sintering were found to form different heterogeneous hardness distribution and microstructures depending on the milling parameters. Microstructure investigations by means of electron-diffraction techniques and atom probe tomography revealed the presence of large particle-free zones in one material, which is, together with the inhomogeneous deformation at short milling times, considered the main reason for the formation of a heterogeneous microstructure. The inhomogeneous temperature distribution in the sample volume during the sintering process is also expected to contribute to the formation of a heterogeneous grain size distribution in the final material.