Two-dimensional heterostructures, such as Fe2O3/MXene nanoparticles, can be attractive anode materials for lithium-ion batteries (LIBs) due to the synergy between high lithium-storage capacity of Fe2O3 and stable cyclability and high conductivity provided by MXene. Here, we improved the storage performance of Ti3C2Tx (MXene)/Fe2O3 nanocomposite by confining Fe2O3 nanoparticles into Ti3C2Tx nanosheets with different mixing ratios using a facile and scalable dry ball-milling process. Composites of Ti3C2Tx- 25 wt % Fe2O3 and Ti3C2Tx-50 wt % Fe2O3 synthesized by ball-milling resulted in uniform distribution of Fe2O3 nanoparticles on Ti3C2Tx nanosheets with minimum oxidation of MXene as compared to composites prepared by hydrothermal or wet sonication. Moreover, the composites demonstrated minimum restacking of the nanosheets and higher specific surface area. Among all studied composites, the Ti3C2Tx-50 wt % Fe2O3 showed the highest reversible specific capacity of similar to 270 mAh g(-1) at 1C (similar to 203 mAh g(-1) based on the composite) and rate performance of 100 mAh g(-1) at 10C. This can open the door for synthesizing stable and high-performance MXene/transition metal oxide composites with significantly enhanced electrochemical performance for LIB applications.