By exploiting the benefit of the half-Heusler (HH) structure, the nanocomposite strategy has been an effective mechanism for most HH-based thermoelectric materials. We have successfully developed HH-based nanocomposites by economically feasible solid-state reaction (SSR) route followed by Spark Plasma Sintering (SPS). X-ray diffraction (XRD) analysis confirms the single HH phase for Zr0.66Hf0.34NiSn composition, and full-Heusler (FH) as an inclusion phase in HH matrix for Zr0.66Hf0.34Ni1+xSn (x = 0.01, 0.03, 0.05, 0.10) alloys. Energy Dispersive Spectroscopy (EDS) also reveals the nominal stoichiometric compositions to be in close matching with experimental compositions. Thermoelectric measurements have been performed for all the compositions Zr0.66Hf0.34Ni1+xSn (x = 0, 0.01, 0.03, 0.05, 0.10) from 323 to 773 K. Interestingly, increasing FH concentration in the HH matrix (up to Zr0.66Hf0.34Ni1.03Sn) leads to the simultaneous increase in Seebeck coefficient due to optimization of carrier concentration and increase in electrical conductivity due to increased mobility of carriers. Therefore, an optimized power factor of 35.31 μW K−2 cm−1 at 773 K was obtained for Zr0.66Hf0.34Ni1.03Sn alloy. In addition to this, a reduced lattice thermal conductivity of 1.26 Wm−1 K−1 was optimized for Zr0.66Hf0.34Ni1.1Sn composition at 773 K. Thus, enhanced power factor and reduced thermal conductivity have finally resulted in an increased figure of merit of 0.93 at 773 K for the optimized composition Zr0.66Hf0.34Ni1.03Sn, which is nearly 260% more as compared to the pristine HH composition Zr0.66Hf0.34NiSn.