In this study, a coaxial dual-shear jet nozzle is designed to enhance mixing and establish stable methane–oxygen combustion. The characteristics of mixing and combustion of methane–oxygen flames are experimentally investigated in nonreacting and reacting cases by varying the outer-to-middle velocity ratio ru from 1.1 to 5.7. In the nonreacting cases, acetone–planar-laser-induced fluorescence technology is applied to experimentally study the mixing behavior near the nozzle exit. Since the coaxial dual-shear configuration generates a sandwich structure, a flow structure near the exit, including three potential cores and three mixing layers, is established. Two mixture fraction fields divided by a critical velocity ratio ruc are observed, in which the stoichiometric contours have different appearances. Based on the mixing characteristics, a mixing model and a linear scaling relation were presented to predict the stoichiometric mixing length in both nonreacting and reacting flows. Besides, the coaxial dual-shear jets yield more compact flames in cases of ru<2.9, while the conventional coaxial jets produce longer flames with yellow tips. This shows the improvement of the coaxial dual-shear nozzle in mixing and combustion efficiency due to the formation of two shear layers near the nozzle exit. Furthermore, the OH* distribution indicates that the coaxial dual-shear flames produce a lower thermal load on the nozzle, preventing the combustor from experiencing the hazards of ablation.