Among the main requirements for the Ni/8% yttria stabilized zirconia (Ni/8YSZ) material, currently used for manufacturing solid oxide fuel cell (SOFC) anodes, fine homogeneous microstructure, considerable structural and mechanical stability, and sufficient gas permeability are of primary concern. In the present investigation, oxide-dispersion strengthened composite Ni powders containing 2, 5, and 10 vol. % 8YSZ were produced by mechanical alloying (MA) in air using a planetary milling machine and ZrO(2) milling media. The progress of the MA process was followed by particle size analysis, optical metallography, and x-ray diffraction (XRD) techniques. Results showed that dispersion of the oxide particles and structural refinement reached a significant point after milling for 180 h, The crystallite size and lattice distortion showed considerable dependence on the processing parameters. The mechanically alloyed powders were sintered at 1100 degrees to 1350 degrees C. The mechanically alloyed powder containing 10 vol. % 8YSZ exhibited maximum densification, The minimum sintered density was observed for the composite powder containing 2 vol. % 8YSZ.