The effect of mechanical milling on powder mixtures consisting of graphite and AB(5) alloys, prepared either by mechanical alloying or by a high-temperature melting process, has been investigated. The resulting hydride-forming composite electrodes show a 10 and 40% capacity enhancement for are-melted and mechanically prepared AB(5) alloys, respectively. Such an increase in capacity is suggested to be the result of several cumulative effects: (1) a mechanically induced reducing role of graphite which eliminates the AB(5) particles of oxide coatings, enabling a better hydrogen adsorption/absorption and diffusion into the insertion sites of the alloy, (2) the appearance of an increasingly important double-layer capacitance on each particle with increased milling time that adds to the faradic component, and (3) the improved electronic conductivity between the active ABS material and the graphite that allows a better utilization of the alloy.