The axial offset (AO) is a parameter used to monitor the core axial power distribution, and is important for safe reactor operation. Previous works have showed that a new type uranium–thorium (U–Th) based fuel assembly could be used to achieve a more homogenous radial power distribution, and thereby improve the thermal margins in the core. In this paper, it is shown that a core containing U–Th fuel assemblies also reduces the AO and improves the core stability. For an equilibrium U–Th core, the maximum AO could be reduced by 33%, and the minimum AO could be reduced by 8% compared with a standard uranium core. In the U–Th core, the maximum AO was influenced by the more negative moderator temperature coefficient of reactivity, while the minimum AO is mainly affected by the more homogenous radial power distribution. These findings conclude that the U–Th core displays a more homogenous power distribution both axially and radially, thus offering better thermal margins for power uprates and flexible power operation. Moreover, xenon oscillations in the core due to perturbations induced by the control rods are 30% more effectively damped for the U–Th core compared with the standard core, improving the stability in AO.