In the bulk polycrystalline ceramic-carbon nanotube (CNT) composites developed to date, reinforcing CNTs have been present just at the matrix grain boundaries, with the grain interiors being nearly completely devoid of CNT; thus severely limiting the improvements achieved in fracture and wear properties. Against this backdrop, bulk polycrystalline Al2O3-based composites, having multi-walled CNTs (MWCNTs) present within the matrix grain interiors (not just at grain boundaries), have been developed in this work for the first time. Such microstructure development has been rendered possible by an innovative, but facile, wet-chemical synthesis route (sans ball-milling) involving incorporation of well-dispersed MWCNTs directly into matrix sol, followed by rapid gelation (within a few seconds) and sintering (inclusive of crystallization step). Intragranular MWCNT reinforcements (in "sol-gelled" composites) led to significant improvements in indentation-induced crack propagation resistances and abrasive wear resistances, as compared to "conventionally" prepared Al2O3-MWCNT composites (i.e., "ball-milled" counterpart) having the same contents of MWCNT, but present only at grain boundaries. Wear rates recorded with the "sol-gelled" Al2O3-2.5 vol% MWCNT are lower than those for monolithic Al2O3 and "ball-milled" counterpart by similar to 95% and similar to 90%, respectively. Such improvements, as never achieved before, are a consequence of reinforcing the matrix grain interiors with MWCNTs.