Internal oxidation is one of the most common methods to produce in situ nano oxide particles dispersion strengthened copper base composite (ODSC) in powder industry. In this paper, a simplified internal oxidation method was proposed to prepare ODSC composite by using thin strip of Cu-Al alloy. The effects of the addition of rare earth element yttrium and cold deformation on the microstructure and mechanical properties, such as hardness and tensile strength, were investigated briefly. Results show that after 80% deformation, the crystalline grains of the composite matrix plastically deformed in elongated shape to a certain direction as banded fiber structure. The addition of trace element yttrium and cold information increase the hardness and tensile strength of the Cu-0.35Al2O3(Y) composite remarkably, respectively.