In the present study, Fe-10 vol pct Al2O3in situ nanocomposite has been derived by high-energy ball milling of Fe2O3-Fe-Al powder mixture followed by the consolidation using spark plasma sintering (SPS). The consolidated nanocomposite has bimodal-grained structure consisting of nanometer- and submicron-sized Fe grains along with nanometer-sized Al2O3, and Fe3O4 particles. The mechanical property analysis reveals that compressive yield strength of Fe-10 vol pct Al2O3 nanocomposite is 2100 MPa which is nearly two times higher than that of monolithic Fe processed by Mechanical Milling and SPS. The strengthening contributions obtained from matrix, grain size, and particles in the synthesized nanocomposite have been calculated theoretically, and are found to be matching well with the experimental strength levels. © 2016, The Minerals, Metals & Materials Society and ASM International.