Samples of Zr-2.5 wt.% Nb alloy, obtained from pressure tube, were annealed in the temperature range 700-900 °C up to 100 h to investigate the grain growth behaviour. The grain size increases with annealing time (t) and temperature (T) according to the relationship d ∝ t0.21 exp((-387 kJ/mol)/RT). Room temperature hardness increases with the increasing annealing temperature and grain size, which is ascribed to the transformation of β-phase into martensitic α′ and the substructure developed during quenching. The grain sizes, produced by further cold working and annealing for short time (< 1 h), and the corresponding hardness values, however, support the Hall-Petch type relationship in the limited cases.