Metal matrix nanocomposites composed of Al-(20-x) wt.-% Al₂O₃ - (x) ZrO₂, x=0, 1, 2 & 4, were prepared by mechanical alloying technique. The powders' mixture was milled in a planetary ball mill up to 7h. The effect of milling time on properties of obtained powders was studied by using X-ray diffraction analysis (XRD) and transmission electron microscopy (TEM) to investigate phase composition, crystal size and morphology of the milled powders. In order to study the sinterability, the milled nanocomposite powders were cold pressed and sintered in argon atmosphere at different firing temperatures i.e. 300, 370 and 470°C for 1h. Physical properties, namely, bulk density and apparent porosity of sintered bodies were determined by Archimedes method. Phase identification and microstructure of the sintered composites were investigated by using XRD and scanning electron microscope (SEM) as well as energy dispersive spectrometer (EDS). Microhardness of sintered composite was also examined using Vickers hardness indentor. The results were discussed in terms of the effect of milling time on the properties of the prepared powders and sintered composites. The results revealed that the grain size of milled powders was about 30 nm with a noticeable presence of agglomerates. Uniform distribution of nano-sized alumina-zirconia particles in the aluminum matrix could be achieved with increasing milling time. The density of the sintered composites was affected by milling time of starting powders and firing temperature. It increased with increasing milling time and firing temperature. Microhardness of sintered bodies was found to be progressively increased with increasing of milling time of starting powders.