One of typical hydrogen storage alloys, Mg2Ni, was produced by combustion synthesis under five different heating conditions. The product was observed to study the reaction mechanism of this process by using scanning electron microscopy. Compressed samples of magnesium and nickel at 2:1 molar ratio were slowly or quickly heated and kept at constant temperatures for 1.8 ks. The condition of holding temperature influenced to the structure of the product, as expected. When the holding temperature was below the eutectic temperature (779 K) of Mg-Ni, the product was dense and showed a cracked structure. In contrast, under higher holding-temperature conditions, the product indicated fine particles. Moreover, at higher temperatures finer particles with a pseudo-cubic shape were formed. The results implied that the reaction mechanism of this process depends significantly on the heating rate and holding temperature. The reaction equation should obey the crystal growth model above 779 K. These results suggest the possibility of a novel production process of ultrafine powders of an inter-metallic compound.