TiO₂-particles containing Co grains are fabricated via thermal hydrogenation and selective oxidation of Ti-Co alloy. For comparison, TiO₂-Co composite powders are prepared by two kinds of methods which were the mechanical carbonization and oxidation process, and the conventional mixing process. The microstructural characteristics of the prepared composites are analyzed by X-ray diffraction, field-emission scattering electron microscopy, and transmission electron microscopy. In addition, the composite powders are sintered at 800°C by spark plasma sintering. The flexural strength and fracture toughness of the sintered samples prepared by thermal hydrogenation and mechanical carbonization are found to be higher than those of the samples prepared by the conventional mixing process. Moreover, the microstructures of sintered samples prepared by thermal hydrogenation and mechanical carbonization processes are found to be similar. The difference in the mechanical properties of sintered samples prepared by thermal hydrogenation and mechanical carbonization processes is attributed to the different sizes of metallic Co particles in the samples.