Alumina/zirconia composites were synthesized by wet-milling technique and rapid consolidation with high frequency induction heat sintering(HFIHS). The starting materials were a mixture of alumina micro-powder (80%, volume fraction) and 3YSZ nano-powders (20%). The mixtures were optimized for good sintering behaviors and mechanical properties. Nano-crystalline grains are obtained after 24 h milling. The nano-structured powder compacts are then processed to full density at different temperatures by HFIHS. Effects of temperature on the mechanical and microstructure properties were studied. Al2O3-3YSZ composites with higher mechanical properties and small grain size are successfully developed at relatively low temperatures through this technique.