Biochar briquettes have advantages of higher energy volume density and durability, as well as the convenience for storage and transportation. In this paper, the effects of temperature and O2 concentration on gas yields and biochar briquettes physical properties were investigated. The yields of H2 and char decreased with the increase of temperature and O2 concentration. An increase in the temperature and O2 concentration led to an increase in CO2 and CO yields. The CH4 yield reached the highest value of 23.46 g/kg at 800 °C with 4% O2. Higher temperature than 600 °C and O2 concentration than 6% were not good for the volume density and durability rating but were beneficial for the porosity of biochar briquette. The BET surface area and total pore volume of O2-char was higher than those of N2-char produced at the same temperature. Considering comprehensive analysis of temperature requirements, char yield and physical properties, 500 °C and 6% O2 were the optimal oxidative pyrolysis conditions.