Abstract: A new, cost effective process for the production of ultrafine particles which is based on mechanically activated chemical reaction of a metal compound with a suitable reagent. The process involves subjecting a mixture of a metal compound and a suitable reagent to mechanical activation to increase the chemical reactivity of the reactants and/or reaction kinetics such that a chemical reaction can occur which produces a solid nano-phase substance. Concomitantly, a by-product phase is also formed. This by-product phase is removed so that the solid nano-phase substance is left behind in the form of ultrafine particles. During mechanical activation a composite structure is formed which consists of an intimate mixture of nano-sized grains of the nano-phase substance and the reaction by-product phase.