In situ processing of AlN particle reinforced aluminum composites was investigated using a gas bubbling method with nitrogen gas as the gaseous precursor and pure aluminum as the starting matrix in the temperature range of 1173-1573 K. The products were characterized using XRD, SEM, and EDS techniques. Experimental results showed that it is feasible to synthesize AlN particle reinforced Al composites in situ using purified nitrogen gas. Significant AlN was synthesized by bubbling deoxidized N-2 through Al melt. The AlN particles synthesized in situ were small in size (< 10 μm) and were enriched in the top part of the product formed in the crucible. Directly bubbling commercial purity nitrogen gas did not lead to formation of significant AlN due to the deleterious effect of the trace oxygen impurities in the bubbling gas. The deleterious effect of trace oxygen impurities on the mechanism of formation of AlN in the Al-N system was critically analyzed from both thermodynamic and kinetic points of view. Chemisorption of O-2 molecules at the gas bubble-Al melt interface is more favorable and much faster than that of N-2, thereby inhibiting chemisorption of N-2 molecules. Significant AlN can be formed only at the content of oxygen below a critical value in the N-2 bubbling gas. (C) 2004 Kluwer Academic Publishers.