The Nb-1%Zr-0.1%C (wt%) alloy is one of the most promising refractory metal alloys having an excellent combination of high temperature properties. Such a combination of properties makes it suitable for several structural applications in the Compact High Temperature Reactor (CHTR). In order to produce the alloy in different shape and sizes a new thermo-mechanical route has been established. The central idea behind the development of such thermo-mechanical route is to reduce the working temperature and provide suitable intermediate annealing treatments to develop desired microstructures. The present paper reports about the application of orientation imaging microscopy in optimizing annealing parameters like temperature and time as a function of the extent of deformation. Samples were also characterized by optical microscopy and transmission electron microscopy techniques. It has been shown that a heat treatment of 1300°C for 3 hour could produce nearly full-recrystallized microstructure. This paper also discusses about the carbide precipitation, their morphologies, chemical compositions and orientations with the matrix phase.