ZrB2-Al2O3 nanocomposite powder was produced by aluminothermic reduction in Al/ZrO2/B2O3 system. In this research, high energy ball milling was used to produce the necessary conditions to induce a mechanically induced self-sustaining reaction. The ignition time of the composite formation was found to be about 13 min. The synthesis mechanism in this system was investigated by examining the corresponding sub-reactions as well as changing the stoichiometry of reactants. Thermal behavior of the system was also studied.