Abstract: The high energy ball milling technique is an effective method for producing metal matrix composites. Al₂O₃ dispersion strengthened 316L stainless steel powders were prepared using high energy ball milling process. The milled powders were sprayed using a high velocity oxy-fuel spraying process.The microstructure and microhardness of the milled powders and corresponding coatings were investigated. The abrasive wear resistance of the coatings was evaluated using pin-on-disk tests. It was found that most of the Al₂O₃ particles distributed uniformly in 316L stainless steel matrix after milling had smaller size than 1μ m, and consisted of micron-sized particles, sub-micron sized particles and nano-scale particles.The microhardness of the milled powders increased with increasing milling time. No obvious change of the microstructure of the milled powders after spraying was observed. However, the coatings were softer than the milled powders, and the composite coatings were much more wear resistant than the single matrix material coatings.