In this study, a high energy ball milling process was introduced in order to improve the densification of direct nitrided AlN powder. The sintering behavior and thermal conductivity of the AlN milled powder was investigated. The mixture of AlN powder and 5 wt% $Y_2O_3$ as a sintering additive was pulverized and dispersed by a bead mill with very small $ZrO_2$ bead media. The milled powders were sintered at $1700^{circ}C-1800^{circ}C$ for 4 h under $N_2$ atmosphere. The results showed that the sintered density was enhanced with increasing milling time due to the particle refinement as well as the increase in oxygen contents. Appropriate milling time was effective for the improvement of thermal conductivity, but the extensive millied powder formed more fractions of secondary phase during sintering, resulted in the decrease in thermal conductivity. The AlN powder milled for 10min after sintering at $1800^{circ}C$ revealed the highest thermal conductivity, of 164W/$m{cdot}K$ in tne densified AlN sintered at $1800^{circ}C$.