We have developed a composite material of dispersed diamond particles in cemented carbide without using ultra high pressure equipment. The developed diamond dispersed cemented carbide combines the excellent properties of cemented carbide with diamond and also provides 1.5 times improved fracture toughness over that of cemented carbide. They also show 10 times higher wear resistance over that of cemented carbide in a wear resistance test against bearing steel, and 5 times greater grindability than diamond compacts. Because ultra high pressure equipment is not used to produce the developed material, large compacts over 100mm in diameter can be manufactured.