Nanofluids have gained much attention in the last decade due to wide range of engineering applications. Agglomeration among nanoparticles in nanosuspensions accelerates settling of nanoparticles due to gravity and reduces overall thermal conductivity of nanofluid. Settling characteristics of alumina nanoparticles in six different concentrations in different proportions of ethanol and water mixtures are studied. Surfactant free nanofluids are prepared with Alumina nanoparticles of average diameter 40 nm, 50 nm and 100 nm using two-step method. Settling behaviour of nanoparticles in nanosuspensions is observed under natural and sonicated conditions. Photographic technique is used to measure sediment height in a batch sedimentation apparatus. Heights of the sediments are observed for 24 hours with and without sonication at room temperature. It is found that sonication has significant influence on the stability of nanofluids. Effect of ethanol concentration on the sediment ratio is studied with and without sonication. Aggregation among nanoparticles and interaction of particles with fluid mixtures are investigated by performing various analyses such as Fourier transform infrared spectroscopy (FTIR), transmission electron microscopy (TEM) and particle size analyser. © 2016 The Authors.