Here, we show that nanostructured magnesium-aluminate spinel (MgAl2O4) with a highly uniform grain-size distribution can be fabricated using Y2O3 sintering additive for infrared (IR) window/dome applications. The average grain size of this nanostructured spinel is 345 nm, and the size of the largest grain is 970 nm. As a consequence this nanostructured spinel has high room-temperature strength (470 MPa) and reliability (Weibull modulus 6.2). It also has improved erosion resistance (sand and rain) and thermal-shock resistance. Near-theoretical in-line IR transmission is observed in this nanostructured spinel at room temperature, with an optical scatter of <0.2/cm at 3.39 μm wavelength.