The phase transformation behavior, mechanical properties, and the thermal stability of CuAlAg alloy were studied andminor rare earth (0.1 wt pct La+Ce) was added to improve the mechanical property of the studied alloy. It was foundthat Ag addition in the CuAl binary alloy can improve the stability of martensitic transformation and high Al contentleads to the disappearing of martensitic transformation. The tensile strength and strain of the Cu-10.6Al-5.8Ag (wtpct) alloy were measured to be 383.5 MPa and 0.86%, respectively. With rare earth addition, the tensile strainincreased from 0.86% to 1.47%. The CuAlAg alloy did not exhibit martensitic transformation on the second heatingprocess. Its poor thermal stability still needs to be improved.