Metal matrix composites (MMCs) constitute an important class of design and weight-efficient structural materials that are encouraging every sphere of engineering applications. There has been an increasing interest in composites containing low density and low cost reinforcements. Among various discontinuously dispersed solids used, fly ash is one of the most inexpensive and low density reinforcement available in large quantities as solid waste by-product during combustion of coal in thermal power plants. Hence, composites with fly ash as reinforcement are likely to overcome the cost barrier for wide spread applications in automotive and small engine applications. To produce Al matrix cast particle composites, wettaility of the ceramic particles by liquid Al is essential. To improve wettabilty, elements such as Mg and Si are added into Al melt to incorporate the ceramic particles. The present investigation has been focused on the utilization of abundant available industrial waste fly ash in useful manner by dispersing it into aluminium matrix by liquid metallurgy route. Wide size range (0.1-100μm) fly ash particles are used. To increase lubrication 5% of graphite is added as extra reinforcement. These composites were analyzed and tested the mechanical properties. The result reveals that the addition of flyash and graphit particles in aluminium matrix improves the mechanical properties.