The aim of this study is to synthesize MgO-Y2O3 nanocomposite by combustion sol-gel method from sucrose as a combustion agent. The influence of the ratio of sucrose (Su) to the transition metals (TM) on the phase and particle size of the composite nanopowder was investigated using a combination of X-ray diffraction, transmission electron microscopy (TEM) and scanning electron microscopy techniques. In order to prediction of phase growth, the kinetics of crystallization of MgO-Y2O3 nanocomposite was also studied in the isothermal conditions using a differential scanning calorimetric technique. Results show that increasing the concentration of sucrose reduced the particle size from 29.3 to 21.6 nm. The ratio of Su to the TM optimized on 4 value. The Avrami exponent was found to be about 3 indicating 3-dimensional growth. The activation energy of crystallization was also determined to be 34.9 ± 0.01 kJ mol−1. Finally, the TEM results confirmed the 3-dimensional growth of MgO-Y2O3 nanopowders.