The purpose of this study is to design and fabricate a new zirconium alloy with improved higher mechanical properties and to characterize it. The new experimental zirconium allay was Zr-1Nb-0.5Sn-xMo with addition of 0, 0.2, 0.5 and 0.7wt.% Mo, respectively. In order to characterize the experimental alloys, age hardening treatment was done at 500℃ for 1h, 4h, and 8h. Then tensile strength at room temperature and Vickers micro-hardness have been measured, and micro-structural observation have been performed to identify the distribution and the shape of the precipitates. Results showed that hardness and tensile strength increased with increasing aging time up to about 4 hours, while ductility decreased. Especially, the alloy with addition of 0.5% Mo(Zr-1Nb-0.5Sn-0.5Mo) showed highest hardness and tensile strength among the four experimental alloys. Transmission electron microscopic examination revealed formation of fine spheroidal and cylindrical precipitates in the alloys with Mo addition, and SADP analysis revealed that the precipitates were mainly β-Nb and ZrMo₂. From these experimental alloys, it was observed that the micro-hardness and tensile strength considerably increased with the age hardening treatment, due to the formation of very fine precipitates which were evenly distributed through the matrix and particularly at twin boundaries.