Agglomeration and poor distribution/dispersion of carbon nanotubes (CNTs) within the matrix remains a major problem in processing homogeneous CNT reinforced metal matrix nanocomposites. In this work, we examine the effect of processing on the dispersion of CNTs in Al6061 and Al2124 alloy based Nanocomposites. Three methods were used to prepare the nanocomposite powders. In the first, CNTs were mixed with the prealloyed powder through dry ball milling. In the second, CNTs were sonicated then the prealloyed powder was added followed by sonication of the mixture and wet milling. In the third, the CNTs were functionalized, sonicated, and then the prealloyed powder was added followed by sonication of the mixture and wet milling. The effect of functionaliztion, sonication and type of milling on the dispersion of CNTs was evaluated.