High-density cobalt-dispersed-alumina (Co/Al 2 O 3 ) composites were successfully prepared by hot-pressing of alumina-cobalt composite powders with fine cobalt ∼30nm in diameter. The nanocomposite powders were prepared by co-deposited processing of Al 3+ and Co 2+ , followed by calcination and selective reduction. The phase composition of Co/Al 2 O 3 composites were α-Al 2 O 3 , fcc-Co and a little amount of hcp-Co. Microstructural investigations revealed that submicron-sized cobalt particles were dispersed homogeneously at alumina grain boundaries, forming intergranular composites. Meanwhile growth and coalescence of cobalt particles occurred with increasing Co-content. The ferromagnetic properties of the composites were measured, because of the magnetic dispersions, which indicated a functional value of Co/Al 2 O 3 composites. The effects of grain size and the residual stresses on magnetic properties for Co/Al 2 O 3 system were discussed in detail.