The use of nanocomposites in materials processing can lead to monophasic or multiphasic ceramics, glasses or porous materials, with tailored and improved properties. This review deals with a variety of nanocomposites such as sol–gel, intercalation, entrapment, electroceramic and structural ceramic types, which exhibit superior properties when compared to the monophasic or microcomposite alternatives. The utilization of nanocomposites in materials processing is forecasted to have a major impact in catalytic, sensor, optical, electroceramic and structural ceramic materials.