The present study is concerned with nanooxide-reinforced zirconium alloys in the Zr–Nb–Sn–Fe system containing up to 1.5% wt. Y$_2$O$_3$ and 1.2% wt. ZrO$_2$. They is designed and examined mechanically and chemically using spectrographic, chemical and X-ray analyses as well as strainrate sensitivity tests and isothermal tensile creep testing to reveal processing-chemistry-structure relations responsible for the strengthening effects. In this study, a family a series of new experimental alloys based on h.c.p. Zr–Nb–Sn–Fe system and reinforced by nanooxides is designed to improve their mechanical strength and dislocation creep resistance. To achieve this purpose, the effectiveness of their nanophase strengthening mechanisms is verified in ascast, deformed, and annealed conditions. An innovative method for nanooxide incorporating in the melt is developed to provide more uniform distribution of the nanoparticles. Nanosized refractory oxides (nm-yttria Y$_2$O$_3$ and nm-zirconia ZrO$_2$) are identified by proper electron microscopy technique. Stress relaxation and strain rate change tests are performed to optimize the specific properties of short- and long-term strengths at 293 and 673 K. The refractory nanooxide of yttrium is shown to be more effective compared to nanozirconia. Post thermomechanical treatment of as-cast zirconium alloys shows its beneficial influence on the better combination of strength and ductility of the nanoreinforced zirconium alloys. A yield drop and stress serrations due to deformed aging and dynamic strain aging are observed in h.c.p. Zr–1.0Nb–0.6Zn–0.17Fe alloys nanoreinforced by nm Y$_2$O$_3$ and nm ZrO$_2$. Inevitable impurity oxygen atoms acting by an interstitial mechanism are likely to be responsible for the dragging of mobile dislocations to hinder their cross slip and to intensify the effect of dynamic strain aging in the commercially pure Zr and its alloys. The observed strengthening effects of yield point elongation and dynamic strain aging appear to cause by the interaction between dislocations and inevitable interstitial impurity of solute oxygen atoms (up to 0.15%). Under the data of thermoactivation analysis the steady-state creep strain rate is assumed to be controlled by a thermally activated dislocation by-pass mechanism with the activated energy of 4.3 eV and the activation volume of 31.5$b^3$ as well as 3.4 eV and 22.5$b^3$ for the deformation of as-cast and deformed Zr–1Nb–1.5Sn–0.17Fe–1.5 nm Y$_2$O$_3$ alloys respectively. Decrease of the activation parameters for deformed alloy state is likely to be associated with shortening of the activation length for mobile nanosegment and possible increase a number of the jogs on dislocations. As a result of these findings, the thermally activated overcoming of the nanooxides by dislocation climb appears to be a rate-controlling by-pass mechanism responsible for excellent optimal combination of short-range and long-range properties at 673 K including higher dislocation creep resistance by inhibiting of glide. The outcomes of trials indicate that the experimental data obtained are best of all consistent with those predicted by the Arzt–Wilkinson model. The discontinuously nanooxide-reinforced zirconium matrix composites should be considered as one of the major innovations in materials engineering that provide an opportunity to combine the metallic properties with the ceramic ordered properties of strengthening nanooxides and thereby to improve the strength, modulus and thermal stability of the material as a whole. These materials are attractive for advanced structural and nuclear industrial applications as a conning material in nuclear fuel element.