A three-phase alumina-yttrium aluminum garnet (Y3Al5O12, YAG)-zirconia composite with the ternary eutectic composition was obtained by a solid-state reaction route starting from commercial powders of Al2O3, Y2O3 and monoclinic ZrO2. Bulk composites with a relative density of 97% of the theoretical value were obtained after sintering at 1500 °C in air for 10 h, with a homogeneous microstructure formed by fine and equiaxed grains with average grain sizes of about 1 µm. Compressive mechanical tests were performed in the temperature range 1300 - 1450 °C in air. The data show a gradual brittle-ductile transition with increasing temperature. In the ductile region, extensive steady-state deformation was found, characterized by a stress exponent of 2 and by the absence of changes in grain morphology. Grain boundary sliding is the main deformation mechanism in such experimental conditions, as reported for superplastic metals and ceramics.