Al2O3-TiO2 composite is known as an excellent hardness, corrosion, and wear-resistant material that can withstand up to 1000 °C. The presence of unstable Al2O5Ti synthesized by powder metallurgy and plasma spray deteriorates the performance of these properties. In this study, two approaches are highlighted which are in situ processing and adding another phase such as graphite into the Al2O3-TiO2 nanocomposite could be solutions to the problem. Al2O3-TiO2 and Al2O3-TiO2-graphite nanocomposites were prepared using in situ processing followed by powder metallurgy routes. The effect of milling times (30, 60, 90, and 120 h) and compaction pressures (200, 400, 600, and 800 MPa) on microstructural, structural, compressibility, and density of Al2O3-TiO2 and Al2O3-TiO2-graphite composites were evaluated. XRD analysis for both composites revealed that the Al2O5Ti phase did not exist in the composite. Milling up to 120 h resulted in a reduction of crystallite size and an increment of internal strain, but only had a slight change in the composite morphology and density. The Al2O3-TiO2-graphite composite exhibited better dispersion of reinforced phase than of Al2O3-TiO2 composite which gave better densification. The densification behavior of both composites depends very much on the compressibility of the composite powder particles.