High-energy ball milling was applied to produce nanocrystalline MgH2-FeTi powder composites. In order to achieve a remarkable synergetic effect between the two materials, the amount of the FeTi catalyst was chosen to be 40 wt.%, 50 wt.% and 60 wt.%. The morphology and microstructure of the as-milled powders were characterized by scanning electron microscopy and X-ray diffraction, respectively. The evaluation of the diffraction profiles by the Convolutional Multiple Whole Profile fitting algorithm provided a detailed microstructural characterization of the coherently scattering α-MgH2 crystallites. Differential scanning calorimetry experiments revealed two overlapping endotherms corresponding to the dehydrogenation of metastable γ-MgH2 and stable α-MgH2 hydrides. Isothermal hydrogen-sorption experiments were carried out in a Sieverts-type apparatus. It was established that the MgH2-40 wt.% FeTi powder is capable of absorbing 5.8 wt.% hydrogen, while extraordinary absorption kinetics were observed for the MgH2-50 wt.% FeTi alloy, i.e., 3.3 wt.% H2 is absorbed after 100 s.