A supersaturated single-phase Cu–26 at.% Co alloy was produced by high-pressure torsion deformation, leading to a nanocrystalline microstructure with a grain size smaller than 100 nm. The nonequilibrium solid solution decomposed during subsequent isothermal annealing. In situ high-energy X-ray diffraction was used to map changes linked to the separating phases, and the development of a nanoscale Cu–Co composite structure was observed. To gain further information about the relationship of the microstructure and the mechanical properties after phase separation, uniaxial tensile tests were conducted on as-deformed and isothermally annealed samples. Based on the in situ diffraction data, different isothermal annealing temperatures were chosen. Miniaturized tensile specimens with a round cross section were tested, and an image-based data evaluation method enabled the evaluation of true stress–strain curves and strain hardening behavior. The main results are as follows: all microstructural states showed high strength and ductility, which was achieved by a combination of strain-hardening and strain-rate hardening.