The influence of plastic deformation and heat-treatment on the precipitation of Al3(Sc, Zr) particles and the effect of these precipitates on hardening and softening processes of dilute ternary Al-0.2wt.%Sc-0.1wt.%Zr alloy was investigated. Behaviour of two differently prepared alloys (mold cast and prepared by powder metallurgy – PM) was investigated in as-prepared and in cold rolled state. Both alloys exhibit the same peak age hardening, PM one reaches it already during extrusion at 350°C. Both cold rolled alloys are highly resistant against recovery, which proceeds without rapid hardness decrease at high temperatures. Evolution of hardness agrees well with that of resistivity and with TEM observation.