xEu 2 O 3 –(1−x)α-Fe 2 O 3 (x=0.1, 0.3, 0.5, and 0.7) nanoparticle system was successfully synthesized by mechanochemical activation of Eu 2 O 3 and α-Fe 2 O 3 mixtures for 0–12 h of ball milling time. The investigations aimed at exploring the formation of magnetic ceramic nanostructures, which are of crucial importance for catalysis and sensing applications. X-ray powder diffraction (XRD),as well as 57 Fe and 151 Eu Mössbauer spectroscopy and thermal analysis by differential scanning calorimetry (DSC) and thermal gravimetric analysis (TGA) was used to study the phase evolution of xEu 2 O 3 –(1−x)α−Fe 2 O 3 nanoparticle system under the mechanochemical activation process. Rietveld refinement of the XRD patterns yielded the values of the particle size as a function of composition and milling times and indicated the formation of the EuFeO 3 perovskite for large x values and long milling times. The 57 Fe Mössbauer studies showed that the spectrum of the mechanochemically activated composites evolved from a sextet for hematite to sextets and a doublet upon duration of the milling process with europium oxide. The 151 Eu Mössbauer investigations showed that the isomer shift decreased with increasing milling time for all molar concentrations employed. These results correlate well with the DSC/TGA analysis, which shows the consumption of hematite and the formation of EuFeO 3 in the system under investigation.