In this study, AZ91C magnesium matrix in-situ nano-composites reinforced with oxide particles were produced by addition of 2 wt% nano silica in the form of a 50wt.%Al+50wt.%SiO2 (np) activated powder mixture to the melt using stir casting method. For this purpose, the activated powder mixture was embedded in AZ91C ingots and their temperature was stabilized at 800oC. Then the melt temperature was reduced to 750oC and the composite slurry was stirred for 15 min. Finally the slurry was cast in a preheated die at 720oC. Control samples were also cast under the same conditions. Improved microstructure, reduced porosity and increased hardness, tensile strength and yield strength of the composite sample were revealed by microstructural and mechanical investigations. The hardness, yield strength and tensile strength values increased from 67 BHN, 84 MPa and 168 MPa for the monolithic samples to 80 MPa, 120 MPa and 230 MPa for the in-situ formed cast composites, respectively. Microstructural and EDS analyses suggested the in-situ formation of Al2O3, MgAl2O4 and MgO oxide particles by in-situ reaction of Al, Mg and SiO2 in the melt.