In the brazing process, the powder brazing filler metal is widely used. It is often used not only in the production of some complicated workpieces but also in the process production of repair welding and incomplete penetration. Besides, it can also be used in automated production, with a promising future. Due to their large specific surface area, the silver-based powder filler metal easily suffers an increase in oxygen content. However, few systematic studies have been conducted on the effect of the oxygen content on the performance of silver-based powder brazing filler metals. In this study, both density functional theory (DFT) calculations and a variety of analytical methods were employed to study the effects of increased oxygen content on the melting characteristics and brazed joint mechanical properties. The results revealed that the apparent activation energy of the filler metal increased with the increasing oxygen content, resulting an increased melting time. The tensile strength of the brazed joints decreased nonlinearly with the increasing oxygen content in the filler metal. To ensure good performance of brazing filler metals, the filler metal oxygen content should be controlled to be less than 200 ppm. According to the fatigue testing results, the oxygen induced brazing defects severed as a source of fracture cracks. Our studies provided a detailed mechanism of the oxygen effects on the brazing process of the silver-based powder filler metals.