Novel ZrB2-reinforced zirconium (Zr) alloys with different boron (B) and aluminum (Al) contents were produced by arc-melting technique. Microstructural observation indicated that both the α-lath and the prior-β grain size were significantly refined with increased B content. The thickness of α lath gradually increased with increased solute atom Al content. Compressive test results showed that the modulus and strengths of the alloys improved with increased ZrB2 and Al contents. The presence of abundant ZrB2 whiskers and solid solution atom Al were responsible for the increased Young׳s modulus. The strengthening mechanisms can be attributed to strengthening through load transfer between the ZrB2 whiskers and Zr matrix, morphological changes in alloys resulting from the formation of ZrB2 whiskers, and solid-solution strengthening caused by Al addition. Fractography confirmed that ZrB2 whiskers undertook the load transferred from Zr matrix and that crack sources were primarily generated at ZrB2 whiskers.