Poly(aniline-co-indole)/copper alumina (PANI-co-PIN/Cu–Al₂O₃) with excellent AC conductivity, dielectric properties, and ammonia gas detecting capabilities were synthesised via in situ chemical oxidative polymerization. The presence of Cu–O bonding vibrations and shift of some characteristic peaks in the Fourier transform infrared spectroscopy (FT-IR) revealed the successful encapsulation of Cu–Al₂O₃ nanoparticles in the copolymer. The XRD studies showed the crystalline peaks of Cu–Al₂O₃ in the PANI-co-PIN nanocomposites. The high-resolution transmission electron microscopy (HR-TEM) images confirmed the reinforcement of the inorganic moiety in the copolymer. The results from thermogravimetric analysis (TGA) showed that the inclusion of Cu–Al₂O₃ in the copolymer matrix greatly increases the thermal stability of PANI-co-PIN. The alternate current (AC) conductivity and dielectric properties of nanocomposites were higher than pure PANI-co-PIN. The improved electrical properties of nanocomposites were due to strong contact between the copolymer and metal oxide surfaces. The gas sensing properties of synthesized copolymer nanocomposites showed excellent sensitivity and response towards ammonia gas at room temperature. The PANI-co-PIN/5 wt% Cu–Al₂O₃ nanocomposite has the best gas sensing characteristics. The higher AC conductivity, dielectric properties and gas sensing characteristics of PANI-co-PIN/Cu–Al₂O₃ might be used to develop electrochemical sensing devices.