Aluminum/alumina nanocomposites were processed by hot isostatic pressing at 450 degrees C and 550 degrees C. In the bulk material sintered at 550 degrees C, the composite microstructure was formed by in situ phase transformation of the native amorphous layer on the Al particle surfaces into nanocrystalline alumina dispersoids. The microstructure consisted of an aluminum matrix containing both ultrafine and coarse grains as well as embedded gamma-Al2O3 nanocrystals. The large grains in the matrix stopped the crack propagation during deformation thereby increasing the toughness of the composite. When fracture occurred during deformation at 200 degrees C in air, the heat released due to oxidation smelts aluminum resulting in filament formation between the fracture surfaces. The samples sintered at 450 degrees C and 550 degrees C had similar crystallite size and dislocation density in the matrix while in the former specimen crystallization of the amorphous phase did not occur. Additional annealing of this sample in a calorimeter resulted in the formation of nanocrystalline Al2O3 accompanied by an endothermic peak at about 527 degrees C and mass-reduction of about 3%, probably as result of gaseous products release. The stresses induced by the volume change during crystallization of alumina yielded an increase of the dislocation density in the Al matrix. (C) 2011 Elsevier B.V. All rights reserved.