This paper was focused on the structural evolution and characterization of Al-15vol.% Al₂O₃ composite. Composite powders were characterized by X-ray diffraction and scanning electron microscopy, respectively. The relationship among the stages of mechanical alloying, relative density and microstructure of both pressed and sintered materials were also investigated. It was observed that mechanical alloying process reached the steady state after 5h of milling time and relatively equiaxed powders were synthesized within this time frame. The results showed that as the milling time increased, more homogeneous dispersion of Al₂O₃ particles was obtained in the Al alloy matrix.