In this study, a functionally graded composite (FGC) technique is proposed to produce an electrical contact material made of W/Cu alloy. The prepared composite was sintered and subjected to high-voltage vacuum arc erosion. The composite properties and microstructure are carefully studied based on SEM images before and after exposure to vacuum arc discharge. According to the necking phenomenon observed in the electron micrographs and the quantitative analysis of the particle size, it is evident that the intermediate layer of W/Cu FGC has been in the final stage of the sintering process. The present porosity of FGC samples was less than mono-layered composite (MLC) samples, and the minimum porosity was observed in the three-layered FGC that composed of W70/Cu30 in the first layer. The average hardness of FGC samples was 4% higher than that of MLC samples with an identical composition. The results of the erosion behavior assessment were used to determine the possible arc erosion mechanism. The weight loss was diminished upon erosion when the W/Cu alloys had more than one layer, especially in four-layered FGC. The result also revealed that FGC samples, especially the four-layered composite, had improved heat transfer and prevented heat concentration on the contact surfaces due to higher content of Cu particles in the successive layers and consequently reduced the surface damage.