The present work investigates strengthening mechanisms and mechanical assessment of Ti/Al2O3 nano-composites produced by friction stir processing of commercially pure titanium using nano-sized Al2O3 with different volume fractions and particle sizes. Microstructural analyses were conducted to characterize the grain size of matrix, size and dispersion of reinforcing particles. The mean grain size of the composites ranged from ~0.7 to 1.1 μm that is much lower than 28 μm of the as-received material. Reduction of grain size was found to be in agreement with Rios approach (based on energy dissipated during the motion of an interface through particle dispersion), and showed deviation from Zener pinning model. Scanning and transmission electron microscopies revealed a near uniform dispersion of Al2O3 nano-particles, with only a small fraction of widely spaced clusters. The maximum compression yield strength of the fabricated nano-composite (Ti/3.9%vol of 20 nm-Al2O3) was found to be ~494 MPa that is ~1.5 times higher than that of the as-received material. Strengthening analyses based on grain refining (Hall–Petch approach), load transfer from matrix to reinforcements, Orowan looping, and enhanced dislocation density due to thermal mismatch effects were carried out considering Al2O3 reinforcement with different volume fractions and sizes. However, Hall–Petch approach was found to be the dominant mechanism for the enhancement of yield strength.