In the present work, multiwalled carbon nanotubes (MWNTs) were synthesized by electric arc discharge method in open air atmosphere. The synthesized nanotubes were subjected to multistep purification followed by characterization using Raman spectroscopy and transmission electron microscopy (TEM). These carbon nanotubes (CNTs) have inner and outer diameters of the order of 3.5 nm and 16 nm with an aspect ratio of 63. AA 4032 nanocomposites reinforced with MWNTs were produced by high energy ball milling using elemental powder mixtures. X-ray diffraction (XRD) and scanning electron microscope (SEM) studies showed different phases of composite with and without CNTs. The crystallite size and lattice strain were calculated using an anisotropic model of Williamson–Hall peak broadening analysis, which showed in decreased crystallite size with increasing milling time. TEM studies reveal that the MWNTs were uniformly distributed in the matrix. Thermal stability of the nanocrystalline powders was studied using a differential thermal analyzer (DTA). The mechanically alloyed powders were consolidated using a novel method called equal channel angular pressing (ECAP) at room temperature. The consolidated samples were sintered at 480 °C in argon atmosphere for 90 min. ECAP method was investigated as an alternative to conventionally sintered powder composites. CNT addition has shown significant improvement in the hardness of the system, even though the observed density is relatively low compared with a base alloy. Thus, the results show that ECAP enables sufficient shear deformation results in good metallurgical bonds between particles at lower compaction pressures. Hence, it is proven that ECAP can be effectively used as one of the consolidation technique especially for powders that are difficult to consolidate by other means.