The additive composition of an AlN ceramic substrate material was optimized to achieve high strength and thermal conductivity. MgO-CaO-Al2O3-SiO2 (MCAS) glass and Y2O3 were used as basic additives for improved sintering properties and thermal conductivity, thereby allowing for AlN to be sintered at a relatively low temperature of 1600 °C without pressurization. Yttria-stabilized zirconia (YSZ) was added (0–3 wt%) to further improve the strength of the AlN ceramic. YSZ and Y2O3 reacted with AlN to produce ZrN, Y4Al2O9, and Y3Al5O12 secondary phases. The formation of these yttrium aluminate phases improved the thermal conductivity by removing oxygen impurities, while ZrN formed at the AlN grain boundaries provided resistance to grain boundary fractures for improved strength. Overall, the AlN ceramic with 1 wt% MCAS, 3 wt% Y2O3, and 1 wt% YSZ exhibited excellent thermal and mechanical properties, including a thermal conductivity of 109 W/mK and flexural strength of 608 MPa.