Yttria (Y2O3) and most rare earth oxides are potentially attractive as dispersion for copper-based composites, owing to their thermodynamic stability. In this paper, Cu–0.9vol% Y2O3 composites are prepared by in situ reaction at the liquidus temperature using Cu–0.4wt% Y alloy. Transmission electron microscopy (TEM) observation indicates that Y2O3 nano-particles with a mean size of 5.0nm and inter-space of 20nm are uniformly distributed in the copper m\\atrix. Selected area diffraction (SAD) analysis shows there is a crystallographic orientation relationship of (422)Y2O3//(1¯11¯)Cu and [011¯]Y2O3//[1¯12]Cu, indicating that the cubic Y2O3 phase is coherent with copper matrix. The ultimate tensile strength (UTS) of the prepared Cu–0.9Y2O3 composites is 568MPa, which are strengthened by grain-boundary strengthening, Orowan and shearing mechanism simultaneously. The analyses demonstrate that Orowan and shearing mechanism are the dominant strengthening mechanisms, and the calculated overall strength is in good agreement with the experimentally determined strength.