NiAl/10-mol%-ZrO2(3Y) composites of almost full density have been fabricated via spark plasma sintering (SPS) for 10 min at 1300 degrees C and 30 MPa, The former intermetallic compound, which contains a trace amount of Al2O3, has been prepared via self-propagating high-temperature synthesis. The composite microstructures are such that tetragonal ZrO2 (similar to 0.2 mu m) and Al2O3 (similar to 0.5 mu m) particles are located at the grain boundaries of the NiAl (similar to 46 mu m) matrix. Improved mechanical properties are obtained: the fracture toughness and bending strength are 8.8 MPa.m(1/2) and 1045 MPa, respectively, and high strength (>800 MPa) can be retained up to 800 degrees C.