This paper focuses on the study of nanofabricated deformation mechanisms of nickel-based single crystal high temperature alloys embedded with NbC particles. The mechanical properties, defect evolution, atomic displacement, shear strain, temperature change and atomic precipitation behaviour of the alloy during nanofabrication are deeply investigated through molecular dynamics simulations. It was found that when the tool machined NbC particles on the substrate surface, it experienced lower tangential forces and friction coefficients compared to when machining NbC particles in the sub-surface position. In the latter case, the NbC particles effectively hindered defect development, leading to a significant increase in temperature. Analysis of atomic displacement trends, shear strain, and Von Mises strain revealed that NbC particles provide better protection to the composite’s interior when located beneath the surface rather than on the surface. Additionally, the heterointerface between NbC particles and the nickel matrix can cause local stress concentration, promoting dislocation nucleation. With continuous energy input during machining, dislocation accumulation occurs, significantly enhancing the alloy’s resistance to deformation. This study provides atomic-scale insights into understanding the effect of NbC particles on the nanofabrication properties of nickel-based high-temperature alloys.