In this paper, AZ61 magnesium alloy composites containing nanoalumina and micron-sized copper particulates are synthesized using the technique of disintegrated melt deposition followed by hot extrusion. The simultaneous addition of nano-Al2O3 and copper particulates led to an overall improvement in both microstructural characteristics in terms of distribution and morphology of secondary phases and mechanical response of AZ61. The presence of nanoalumina particulates broke down and dispersed the secondary phase Mg17Al12. The 0.2% yield strength increased from 216 MPa to 274 MPa. The ductility increased from 8.4% to 9.3% in the case of the AZ61-1.5Al2O3 sample. The results of aging heat treatment in the case of the AZ61-1.5Al2O3-1Cu sample showed significant improvement in both tensile strength, ductility, and work of fracture (54% increment). An attempt is made to correlate the tensile response of composites with their microstructural characteristics.