To fabricate an Al-V matrix composite reinforced with submicron-sized Al2O3 and AlxVy (Al3V, Al10V) phases, high energy mechanical milling (HEMM) and sintering were employed. By increasing the milling time, the size of mechanically milled powder was significantly reduced. In this study, the average powder size of 59 µm for Al, and 178 µm for V2O5 decreased with the formation of a new product, Al-Al2O3-AlxVy, with a size range from 1.3 µm to 2.6 µm formed by the in-situ combustion reaction during sintering of HEM milled Al and V2O5 composite powders. The in-situ reaction between Al and V2O5 during the HEMM and sintering transformed the Al2O3 and AlxVy (Al3V, Al10V) phases. Most of the reduced V reacted with excess the Al to form AlxVy (Al3V, Al10V) with very little V dissolved into Al matrix. By increasing the milling time and weight percentage of V2O5, the hardness of the Al-Al2O3-AlxVy composite sintered at 1173 K increased. The composite fabricated with the HEMM Al-20wt.%V2O5 composite powder and sintering at 1173 K for 2 h had the highest hardness.