A novel class of materials called aluminum matrix composites has the potential to meet the requirements of advanced engineering applications. In the current study, Al6061-based GNP nanocomposites were fabricated using a bottom-pouring stir casting technique. Microstructural characterization techniques were used for analyzing the distribution of reinforcement particles and the presence of those particles in the nanocomposite. SEM micrographs showed the dendritic structure with a reduction of the casting defects due to the wetting agent. Intermetallic compounds were observed during the fabrication, which was confirmed by the XRD spectrum. The effect of GNPs on the matrix material was evaluated through mechanical characterization. The microhardness result showed a 25% increase in hardness than the base Al6061 alloy. The micromachinability of the fabricated nanocomposite was evaluated. Microchannels were machined using a two-fluted TiSiN-coated solid carbide end mill tool with a 500 µm diameter. The influence of micromachining parameters, including feed rate, spindle speed, and depth of cut on surface roughness and cutting force was analyzed. The ANOVA result showed that the optimum parameter was observed at a 21000 RPM spindle speed, 10 mm/min feed rate, and 200 µm depth of cut, which showed lower cutting force and high surface quality. The results showed that as spindle speed increased, Fy and Fz decreased by 35% and 13%, respectively, because of the thermal softening of the material. The optimum cutting parameter can generate a channel that is high in quality and dimensionally accurate with few little burrs.