The thermite reaction between Al and CuO is well known and highly exothermic. For a conventional thermite mixture comprising mixed metal and oxide powders, the reaction is rate limited by a slow heterogeneous mass transfer at the metal and oxide interface. The relatively low reaction rate and a difficult ignition have restricted practical applications for this reaction. For newly developed, nano-composed thermites, the interface area can be substantially increased resulting in a much higher reaction rate and a new range of possible applications. Recently, Al-CuO nanocomposite materials were produced by magnetron sputtering and by mixing of Al and CuO nanopowders. Such techniques realize the bottom-up approach, when the nano-domains are built from individual atoms or molecules. Respective materials are generally expensive and difficult to handle. An alternative, top-down approach is discussed in this project. Nanocomposite Al-CuO materials are produced using a technique referred to as arrested reactive milling. Regular metal and oxide powders are blended and ball milled at room temperature resulting in a fully dense and reactive nanocomposite powder. The milling is stopped (or arrested) before a self-sustaining exothermic reaction is triggered. The powder particles are in the 10-100 μm size range. Each particle has an aluminum matrix with copper oxide inclusions in the 20-200 nm size range, depending on milling parameters. This paper focuses on the compositions with excess of Al, useful for applications in propellants, explosives, pyrotechnics, as well as for joining small parts. The paper discusses the preparation and characterization of such Al-rich thermite compositions and suggests an approach for optimizing their manufacturing for the improved performance.