Aluminium Matrix Composites (AMCs) made by A356 as matrix and nano-Al2O3 as reinforced are widely used for high performance application because of light weight and alumina has good performance at high temperature. In this study, the nano-Al2O3 used varied from 0.1 vf-% to 1.2 vf-%, which subsequently determined the optimum point. In addition, the magnesium with 10% are added as a wetting agent between aluminium and nano-Al2O3 as reinforced. Stir casting process is carried out for 2 minutes and 4 minutes for the degassing process using argon gasses then pouring molten metal in to the mold at 800o C. The effect of nano-Al2O3 on the mechanical properties and microstructure of the composites was investigated. The result showed that the tensile strength decreased with the addition of nano-Al2O3 but the hardness increased. Increasing of hardness mainly caused by grain refinement, and particle strengthening which act as obstacles to the motion of dislocations. Addition of nano-Al2O3 as reinforced also tend to form microporosity and agglomeration which would decrease the tensile strength of composites. The optimum strength was reached by 0.5 %Vf nano-Al2O3 with the value of 140 MPa and hardness of 46 BHN which was supported by low porosity level.