The mutual effect of Fe and Sn on the microstructure of Zr alloys was investigated in the present work. It has been found that in Zr-Fe binary alloys (with Fe amount less than 1 wt.%), very few amount of Fe element was dissolved in Zr alloys while most of the Fe was precipitated as Zr₃Fe phase. Moreover, the dimension of Zr₃Fe increased with the Fe content. However, the Sn element added in the present work (≤5.0 wt.%) has been entirely dissolved in Zr alloys, while no precipitate containing Sn element was found. It also observed that the addition of the Sn element could inhabit the recovery and recrystallization process of Zr alloys. In Zr-Sn-Fe ternary alloys, the addition of Sn element could increase the solubility of Fe in Zr alloys, and inhabit the grain growth of lath crystal and migration of Fe element duing rapid cooling process of β-phase. Moreover, finer and more uniformly distributed Zr₃Fe phase were observed after addition of Sn element.