Alumina toughened zirconia (ATZ) nanoceramics with high-strength, high-toughness and high-hardness were prepared by in-situ nanoprecipitation from solid solution micro-powders. The submicron Al2O3 (~ 450 nm) and ZrO2 (~ 350 nm) grains contained low-density precipitated nano-ZrO2 (~ 40 nm) and nano-Y4Al2O9 (YAM, ~ 90 nm) particles, respectively, making high-performance nano-ATZ ceramics with ultrafine intracrystalline nanostructure yet achieved. There was a parallel or eutectic lattice orientation relationship between the submicrocrystals and its internal nanoparticles of their crystal planes, which is very conducive to the improvement of the mechanical properties of nano-ATZ ceramics. The fracture toughness and hardness of 30wt%Al2O3/70wt%ZrO2(3mol%Y2O3) can be as high as 5.68 ± 0.17 MPa·m1/2 (single-edge V-notched beam method, SEVNB) and 16.32 ± 0.45 GPa, respectively, which are improved by ~ 25 % and ~ 20 % compared with those of 3Y-TZP ceramics. Therefore, this method can be used to prepare nano-ATZ ceramics contained ultrafine nanoparticles and uniform distribution of Al2O3 phases.