A zirconium alloy for use in spacer grids for nuclear reactor fuel claddings, which consists essentially of, on a weight percent basis,2.5 to 10% Nb,0.01 to 1.5% of one or more components selected from the group consisting of Y and rare earth elements and oxides thereof,0.05 to 1% of one or more optional element selected from the group consisting of Fe, Cr, Mo and V, andthe remainder Zr and incidental impurities.