The twin objectives of the investigation were (i) to synthesize Al/Al2O3 metal matrix composites (MMCs) with uniform distribution of the Al2O3 reinforcement in the Al matrix and (ii) to evaluate the effect of volume fraction and size of the reinforcement on the mechanical behavior of MMCs. This was achieved by successful synthesis of Al-Al2O3 MMCs with volume fractions of 5, 10, 20, 30, and 50%, and particle sizes of 50 nm, 150 nm, and 5 µm of Al2O3 synthesized from blended component powders by a high-energy milling technique. A uniform distribution of the Al2O3 reinforcement in the Al matrix was successfully obtained after milling the powders for a period of 20 h with a ball-to-powder weight ratio of 10:1 in a SPEX mill. The uniform distribution of Al2O3 in the Al matrix was confirmed by characterizing these nanocomposite powders by scanning electron microscopy and X-ray mapping. The energy dispersive spectroscopy and X-ray diffraction techniques were employed to determine the composition and phase analysis, respectively. The milled powders were then consolidated for subsequent mechanical characterization by (i) magnetic pulse compaction (MPC) (ii) hot-isostatic pressing (HIP), (iii) vaccum hot pressing (VHP), and (iv) a combination of vaccum hot pressing and hot-isostatic pressing (VHP+HIP). However, successful consolidation of the powders to near-full density was achieved only through VHP+HIP for the 5 and 10 vol. % Al2O3 samples with 50 nm and 150 nm particle sizes. The fully dense samples were then subjected to mechanical characterization by compression testing and nanoindentation techniques. The strength and elastic modulus values obtained from compression testing showed an increase with increasing volume fraction and decreasing particle size of the reinforcement. The nanoindentation results were, however, contradictory, and the presence of residual stresses in the samples was attributed as the cause for the deviation in values.