In this work, xAl(2)O(3)-(1 - x)CaCu3Ti4O12, where x = 0, 2, and 10 vol%, nanocomposites were prepared by a conventional mixed oxide method using Al2O3 nanopowders with particle sizes of approximate to 20-40 nm. The giant dielectric properties, electrical responses and nonlinear characteristics of Al2O3-CaCu3Ti4O12 nanocomposites were investigated. Interestingly, the (2 vol%)Al2O3-CaCu3Ti4O12 ceramic exhibited significantly improved dielectric properties with large dielectric constant and low loss tangent values of about of 2.0 x 10(4) and 0.038, respectively. The nonlinear current-voltage properties of CaCu3Ti4O12 ceramics were also enhanced by the addition of Al2O3. X-ray photoelectron spectroscopy technique was used to confirm the existence of Cu+, Cu3+ and Ti3+ ions in the composite ceramics, indicating the primary cause of the conduction mechanism inside the grains. The first principle calculation was performed to predict the most possibility of site preference of Al ion in CCTO lattice structure. The improved dielectric and nonlinear electrical properties can be well explained based on the internal barrier layer capacitor effect, resulting from the improved electrical properties of internal interfaces.