Phase pure titanium diboride (TiB2) powder of 100‐200 nm was synthesized from TiO2 and B2O3 using a molten‐salt‐assisted magnesiothermic reduction technique. The effects of salt type, Mg amount, reaction temperature, and TiO2 raw materials on the synthesis process were examined and the relevant reaction mechanisms discussed. Among the three chloride salts (NaCl, KCl, and MgCl2), MgCl2 showed the best accelerating‐effect. To synthesize phase pure TiB2, 20 mol% excessive Mg had to be used to compensate for the evaporation loss of Mg. Particle shape and size of raw material TiO2 showed little effect on the formation of TiB2 and its shape and size, suggesting that relatively cheaper and coarser TiO2 raw materials could be used for low‐temperature synthesis of TiB2 fine particles. The “dissolution‐precipitation” mechanism governed the overall molten salt synthesis process.