A new composite thermal interface material (TIM) was synthesized by combining AlN with liquid metal (LM, Ga68.5In21.5Sn10) and polydimethylsiloxane (PDMS), one of the most commonly used silicone oils, to enhance the interfacial heat transfer. The microstructure and chemical composition of the material were measured using scanning electron microscopy (SEM) with an energy dispersive spectrometer (EDS) to investigate its principle of heat dissipation. The thermal conductivity (κ) of the AlN liquid metal thermal grease (ALTG) was found to be 5.014 W/m·K, higher than that of a liquid metal/PDMS composite (LMTG) and higher than that of one of the best existing thermal grease products (X23-7762) by approximately 5% and 20%, respectively. Meanwhile, the thermal contact resistance (R) was reduced by 20% and 50%, respectively, and the viscosity remained in an appropriate range, reducing the risks of overflow during usage. An actual test on a CPU showed that ALTG could significantly reduce the operating temperature. The thermal mechanism of ALTG was studied, and a synergistic effect was suggested for the heat transfer process. The results prove the ideal heat dissipation properties of TIMs and their wide application prospects in industry.