Y2O3-MgO nanocomposites are one of the most promising materials for hypersonic infrared windows and domes due to their excellent optical transmittance and mechanical properties. In this study, influence of the calcination temperature of Y2O3-MgO nanopowders on the microstructure, IR transmittance, and hardness of Y2O3-MgO nanocomposites was investigated. It was found that the calcination temperature is related to the presence of residual intergranular pores and grain size after spark plasma sintering. The nanopowders calcined at 1000°C exhibits the highest infrared transmittance (82.3% at 5.3 μm) and hardness (9.99 GPa). These findings indicated that initial particle size and distribution of the nanopowders are important factors determining the optical and mechanical performances of Y2O3-MgO nanocomposites.