In this study, a continuous stabilization process is used to make high-performance carbon fiber from polyacrylonitrile(PAM)-based fibers. The effect of oxygen content of PAN-based fiber on the stabilization process and the properties of the resultant carbon fibers is investigated. In order to research the progress of stabilization reaction FT-IR, elemental analysis, density, DSC, etc are used. Stabilization is carried out in air atmosphere from the 200 to $300^circ{C}$ temperature range. An increase of PAN-based fibers diameter reduces the oxygen content during the continuous stabilization process. A higher oxygen content increase the density, tensile strength and modulus in the resultant carbon fibers. The most appropriate oxygen content in the stabilized fiber should be about 12%. Fibers having more than 2% oxygen content yield carbon fibers with inferior properties. Those carbon fibers also have sufficient commercial availability.