Niobium particle reinforced aluminum oxide (Al2O3) dispersion strengthened copper composite is an attractive and emerging engineered material for applications requiring high strength, high thermal and electrical conductivities and resistance to softening at elevated temperatures. In this paper, the microstructure, tensile deformation and fracture behavior of the composite is examined. The strength of the material decreases with an increase in temperature with a concomitant improvement in ductility. The composite microstructure maintains a high value of yield strength/ultimate tensile strength ratio. The factors contributing to increased strength and the intrinsic mechanisms governing fracture characteristics of the composite are examined in light of intrinsic microstructural effects, nature of loading and deformation characteristics of the matrix.