Experiments using nanofluids in horizontal, rectangular, high-aspect-ratio microchannels were performed where heat was provided electrically to the microchannel wall to bring about heating and phase change while recording temperature (via infrared camera) and channel pressure drop. High-speed video captured images of boiling two-phase flow through the transparent microchannel wall. Nanofluids used were solutions of aluminium oxide in ethanol with particle concentrations from 0.01% to 0.1%, with pure ethanol as reference. Fluid mass flux ranged from Reynolds numbers of 2.3 to 18.1 and heat fluxes from 1.5 to 9 kW m(-2). Friction factors for the nanofluids were evaluated. Single-phase fluid pressure drop did not vary significantly with nanoparticle concentration. When flow boiling occurred, the two-phase flow pressure drop was unstable and fluctuating. Inlet pressures had greater amplitude of oscillation but similar frequency to outlet pressures. Heat transfer increased with the presence of nanoparticles compared with pure ethanol. Moreover, evaporation from the meniscus was studied. There is a sudden evaporation phenomenon where the meniscus rapidly forms. Infrared data demonstrate the effect of heat flux on temperature distribution near the three-phase contact line. Nanoparticles enhance boiling heat transfer coefficients, peaking at a concentration of 0.05% with significant enhancement over pure ethanol.