A quantitative thermodynamic model for the size-dependent formation enthalpy of nanocompounds is proposed. The model reveals that the thermal stability of nanocompounds decreases because of the size dependence of formation enthalpy when the size of these nanostructures decreases. This stability loss is related to some general phenomena such as interface alloying of immiscible systems and phase segregation of miscible systems with reducing system sizes. The predictions from the model are in agreement with the results from density function theory calculation for MgH2, the experimental measurement of SnTe nanoparticles, and quantum chemistry consideration.