Carbon rich fly ash was recently reported to have compositions that are ideal for use as a precursor and catalyst for carbon nanotube growth. This fly ash powder is mostly composed of pure carbon, predominantly present as sp2. In this work, the effect of sonication time on the morphology and structural properties of carbon rich fly ash particles is reported. The obtained results show that ultrasound treatment is an effective tool for producing ultrafine particles/fragments with higher porosity, which might be suitable for the adsorption of gasses. Moreover, carbon nanoparticles (CNPs) of this fly ash were produced in parallel using the ball milling technique, and were evaluated as reinforcements for epoxy based composites. These CNPs have almost spherical shapes with particle sizes of around 30 nm. They were found to have strong C=O carbonyl group bonds, which might be generated during the ball milling process. The tensile testing results of a fly ash CNP reinforced epoxy composite showed significant improvements in the mechanical properties, mainly in the stiffness of the polymer. The stiffness value was increased by around 23% of that of neat epoxy. These CNPs with chemically active groups might also be useful for other applications.