The effect of Y2O3 addition (0–5 wt%) on the densification and properties of reactive hot-pressed alumina (Al2O3)–boron nitride composites based on the reaction between aluminum borate (2Al2O3·B2O3) and aluminum nitride (AlN) was investigated. The densification process was very sensitive to the amount of Y2O3. Compared with a low relative density of 79.3 theoretical density (TD)% for material with no Y2O3 addition, the material density reached 98.6 TD% with 0.25% Y2O3 addition. High Y2O3 additions resulted in the formation of a new phase Al5Y3O12. The grain growth of the Al2O3 matrix was promoted by the Y2O3 addition. Owing to the high density and the small Al2O3 particle size the sample with 0.25% Y2O3 addition demonstrated the highest bending strength of 540 MPa.