Al2O3-Cu/25Cr1Zr and Al2O3-Cu/25Cr3Zr electrical contact materials were fabricated by internal oxidation and fast hot press sintering. The prepared composites have uniform dense structure with over 98% density, 40.5 IACS% and 31.8 IACS% electrical conductivity, 141 HV and 154 HV hardness. TEM results show that internal oxidation during sintering generates diffusely distributed nanoparticles of γ-Al2O3, pinning dislocations and strengthening the matrix. In the 25 V DC, 10–40 A electrical contact tests, Al2O3-Cu/25Cr1Zr and Al2O3-Cu/25Cr3Zr composites show an increase in anode mass and a decrease in cathode mass, with the transfer direction of the material being from cathode to anode. Under the same experimental conditions, Al2O3-Cu/25Cr3Zr showed superior resistance to arc erosion. With the Zr content increased from 1 wt% to 3 wt%, the mass transfer of the electrical contact material decreased by 14.2%, 28.5%, 27.2%, and 8.2%, respectively, and the average arc duration was reduced from 0.4 ms to 0.24 ms, 4.35–2.46 ms, 4.91–3.53 ms, and 5.8–4.58 ms.