Composite nanoparticles of Ni-TiC and Ni-TiN were prepared by an active plasma-metal reaction method. The structure and morphology were evaluated by X-ray diffraction and transmission electron microscopy observations. The morphology of the composite particles is dice-like or dumbbell-like, where the outer sides are metallic and the inner part of the rod (or dice)-like structure is TiC or TiN. The formation mechanism of the composite particles is considered by analogy to the VSL mechanism. The thermal stability of the nanocomposite particles is vastly superior to that of the metal particle. The excellent catalytic property of the Ni-TiN composite particle was confirmed when compared to the well-known Raney Ni particle and mixed particles of Ni and TiC.