III-V nitride semiconductors have exhibited a promising technology platform for optoelectronic and electronic devices. For low Al composition (<40 %) AlGaN/GaN high-electron mobility transistors (HEMTs), enormous progress has been made in high frequency and high power applications. For scaling down to deep sub-micrometer dimensions, high Al composition AlGaN barrier can offer higher two-dimensional electron gas (2DEG) density and lower sheet resistance than low Al composition AlGaN. However, molecular beam epitaxy (MBE) grown high Al composition AlGaN has been observed to suffer spontaneous phase modulation and the electron mobility was severely limited. In this work, MBE growth of high electron mobility 2DEG in nitride heterostructures with >70 % Al composition AlGaN ternary alloy barriers is reported. The MBE epitaxial growth of relatively thick (>3 nm) high Al composition (>70 %) AlGaN directly on top of GaN resulted in hexagonal stripes, indicating of lateral phase separation. By inserting an ultrathin (~0.6 nm) AlN spacer, the room temperature electron mobility was increased by more than one order of magnitude, and the surface morphology was dramatically improved and exhibited terraces and atomic steps. An ultrathin AlN interlayer was crucial to suppress phase separation and yield high mobilities, paving the way for deep submicron HEMTs. Based on the high quality AlGaN barrier layers, threshold voltages (Vth) shifts of Al0.72Ga0.28N/AlN/GaN HEMTs by employing different gate metal stacks was observed for the first time. With a 4 nm Al2O3 gate dielectric deposited by atomic layer deposition (ALD) on top of the nitride heterostructures, the ~0.9 eV work function difference between Al and Ni induced ~0.9 V Vth shift in pairs of Al/Au and Ni/Au gate HEMTs, which indicates that the Fermi level is unpinned at the ALD Al2O3/AlGaN interface. The results were reproducible for HEMTs of various gate lengths suggesting that it is possible to tune threshold voltage and obtain enhancement (E) and depletion (D) mode AlGaN HEMTs using work function engineering. This finding can enable integrated monolithic digital circuits without post-growth gate recess etching or ion implantation.