A novel uranium dioxide (UO2)–carbon nanotube (CNT) ceramic matrix composite fuel concept has been proposed for a nuclear fuel with increased thermal conductivity. Investigations were performed to analyze the dispersion of CNTs in a UO2 matrix utilizing homogenization and sonication techniques. Ethanol and ortho-dichlorobenzene (ODCB) were utilized as solvents during the mixing process. Distributions of both multiwalled carbon nanotubes and single-walled carbon nanotubes (SWNTs) were analyzed. It has been determined that CNTs can be homogeneously distributed into a UO2 matrix using mechanical processes, sonication, and homogenization in the organic solvent ODCB. The powder mixture of UO2 and CNTs was sintered at 1300°C with a hold time of 5 min and 40-MPa pressure in a spark plasma sintering furnace, and the resulting grain size distribution was analyzed. It was observed that where the distribution of CNTs was not well controlled, significant grain growth of UO2 occurred. However, where the CNT distribution is well controlled, the grain growth is limited by the pinning effect of the CNTs along the grain boundaries. The resulting pellet thermal conductivity was improved by 29.7% with the addition of 5 vol % SWNT, relative to pure UO2 values. Raman spectroscopy in conjunction with scanning electron microscopy shows that most CNTs survive both the mixing and sintering processes.