The deformation behavior of dispersion strengthened copper alloy Cu-Al2O3 was studied by TEM. The results show that nano-scaled dispersed second phase not only increases dislocation density in matrix, but also has an important influence on the dislocation substructure. The presence of fine dispersed Al2 O3 particles results in a uniform and random dislocation distribution in matrix copper and causes the difficulty in formation of dislocation cell structure and the decrease in the amount of cell structure during deformation. Deformation gives rise to much more dislocations and dislocation cells form more difficultly and the decrease in the cell size with the increase of dispersion degree.