Using a plasma spray torch, nanocrystalline γ -alumina powder has been synthesized in a reactor through oxidation of micron-size aluminum metal powder by in-flight thermal plasma processing. The synthesized particles were characterized by X-ray diffraction (XRD) and field emission transmission electron microscopy (FE-TEM). The particle size was in the range of ~7 to ~56 nm and spherical in shape. Furthermore the nonlinear refractive and absorptive indices of the sample under various intensities using Z-scan and moire deflectometry techniques by a CW He-Ne laser at 632.8 nm wavelength were measured.