The aims of this study were to fabricate a novel titanium/silicon carbide (Ti/SiC) metal matrix nanocomposite (MMNC) by friction stir processing (FSP) and to investigate its microstructure and mechanical properties. In addition, the adhesion, proliferation and osteogenic differentiation of rat bone marrow stromal cells (BMSCs) on the nanocomposite surface were investigated. The MMNC microstructure was observed by both scanning and transmission electron microscopy. Mechanical properties were characterized by nanoindentation and Vickers hardness testing. Integrin β1 immunofluorescence, cell adhesion, and MTT assays were used to evaluate the effects of the nanocomposite on cell adhesion and proliferation. Osteogenic and angiogenic differentiation were evaluated by alkaline phosphatase (ALP) staining, ALP activity, PCR and osteocalcin immunofluorescence. The observed microstructures and mechanical properties clearly indicated that FSP is a very effective technique for modifying Ti/SiC MMNC to contain uniformly distributed nanoparticles. In the interiors of recrystallized grains, characteristics including twins, fine recrystallized grains, and dislocations formed concurrently. Adhesion, proliferation, and osteogenic and angiogenic differentiation of rat BMSCs were all enhanced on the novel Ti/SiC MMNC surface. In conclusion, nanocomposites modified using FSP technology not only have superior mechanical properties under stress-bearing conditions but also provide improved surface and physicochemical properties for cell attachment and osseointegration.