One of the salient features of powder processing using high energy mechanical milling is the creation of a large area of interfaces between different phases through formation and refinement of a composite structure in each powder particle. When there exists a thermodynamic driving force for the reactions of the different phases in contact, they tend to occur. The kinetic requirements by nucleation and growth of the new phase to be formed by the reaction dictate the reaction paths. With increasing interface area, the nucleation plays increasingly important role in controlling the reaction path This paper shows that using the relatively simple classical nucleation theory, a great insight can be achieved on the factors influencing the selection of first phase to be formed and the dependence of reaction temperature on the interface area during mechanical alloying and solid state reactions during heat treating of the mechanically milled powders.