Aluminum matrix composites reinforced by fine steel wires were fabricated by squeeze casting process. Preforms made of fine steel wires were prepared with different surface conditions, namely uncoated(TN), carbo-nitriding treated(TT), and brass coated(TA). Squeeze casting were performed under the pressure of 1500㎏/㎠ for 3min. during solidification, and pouring temp. of the melt being 750℃ and the steel mold being preheated at 250℃. Microstructural characteristics were evaluated, particularly concerned with the effect of the surface conditions of the preforms. The results obtained from this study are like these. TN specimens show partially non-wetted regions, due to easy formation of oxides on the surface of the fine steel wires. TT specimens show no interfacial reaction between the steel wires and the aluminum alloy matrix, possibly due to the formation of carbo-nitrided zone on the surface of the steel wires. TA specimens show excellent wettabillity between the reinforced steel wires and the aluminum alloy matrix and very thin interfacial zone is formed between them. During the solution hardening treatment of TA specimens, thickness of the interfacial reaction zones were increased with the solution treating time. TA specimens show typical ductile fracture in tensile test, but TT specimens show brittle fracture possibly due to the formation of the brittle hard surface on the steel wires during carbo-nitriding treatments. TA specimens which were reinforced with 40 vol.% of the fine steel wires exhibit high tensile strength of 77.l㎏f/㎟ and impact value of 8.l㎏f-m/㎠.