β-Al₃Mg₂ intermetallic was used as a reinforcing agent to improve the mechanical properties of an aluminum matrix. Different amounts of Al₃Mg₂ nanoparticles (ranging from 0wt% to 20wt%) were milled with aluminum powders in a planetary ball mill for 10 h. Consolidation was conducted by uniaxial pressing at 400℃ under a pressure of 600 MPa for 2 h. Microstructural characterization confirms the uniform distribution of Al₃Mg₂ nanoparticles within the matrix. The effects of nano-sized Al₃Mg₂ content on the wear and mechanical properties of the composites were also investigated. The results show that as the Al₃Mg₂ content increases to higher levels, the hardness, compressive strength, and wear resistance of the nanocomposites increase significantly, whereas the relative density and ductility decrease. Scanning electron microscopy (SEM) analysis of worn surfaces reveals that a transition in wear mechanisms occurs from delamination to abrasive wear by the addition of Al₃Mg₂ nanoparticles to the matrix.