Novel one-dimensional template-grown coaxial SiC@carbon nanotubes (SiC@CNTs) were fabricated using a chemical vapor deposition method. To facilitate the formation of SiC on CNT template, a molecular-level mixing process was used to coat the surface of commercial multiwalled carbon nanotubes (MWCNTs) by Fe2O3. These Fe-CNTs were transformed into SiC@CNT nanotubes, which were then mixed with Al6061 alloy and consolidated by spark plasma sintering to obtain Al6061-SiC@CNT nanocomposites. The addition of 5 vol% SiC@CNT resulted in 58% enhancement in Young's modulus and 46% enhancement in yield strength. Furthermore, the friction coefficient was reduced by 31% and the specific wear rate was reduced by 45%. The enhancement effect of Al6061-SiC@CNT on the mechanical and tribological properties was much greater than those of traditional nanoparticles, nanowires, and whiskers of SiCs. The extraordinary strengthening behavior of SiC@CNT, when compared with that of other SiC analogues, is attributed to the coaxial structure consisting of a SiC shell and CNT core. This coaxial structure enhanced the mechanical and tribological properties beyond that attainable with traditional SiC-derived reinforcements.