Nanocomposites have become a new paradigm for thermoelectric research in recent years and have resulted in the reduction of thermal conductivity via the nano-inclusion and grain boundary scattering. In this work, we report the preparation and thermoelectric study of SiGe-yttria stabilized zirconia (YSZ) nanocomposites prepared by Spark Plasma Sintering (SPS). We experimentally investigated the reduction of lattice thermal conductivity (κL) in the temperature range (30–800 K) of n-type Si80Ge20P2 alloys with the incorporation of YSZ nanoparticles (20–40 nm diameter) into the Si-Ge matrix. These samples synthesized by using the SPS technique were found to have densities > 95% of the theoretical density. The thermal conductivity, at both low and high temperatures, was measured by steady state and laser flash techniques, respectively. At room temperature, we observed approximately a 50% reduction in the lattice thermal conductivity as result of adding 10% YSZ by volume to the Si80Ge20P2 host matrix. A phenomenological model developed by Callaway was used to corroborate both the temperature dependence and reduction of κL over the measured temperature range (30–800 K) of both Si80Ge20P2 and Si80Ge20P2 + YSZ samples. The observed κL is discussed and interpreted in terms of various phonon scattering mechanisms such as alloy disorder, the Umklapp phonon scattering, and boundary scattering. In addition, a contribution from the phonon scattering by YSZ nanoparticles was further included to account for the κL of Si80Ge20P2 + YSZ sample. The theoretical calculations are in reasonably good agreement with the experimental results for both the Si80Ge20P2 and Si80Ge20P2 + YSZ alloys.