The alumina dispersion-strengthened (DS) C15715 Cu alloy fabricated by a powder metallurgy route was annealed at temperatures ranging from $800^{circ}C;to;1000^{circ}C$ in the air and in vacuum. The effect of the annealing on microstructural stability and room-temperature mechanical properties of the alloy was investigated. The microstructure of the cold rolled OS alloy remained stable until the annealing at $900^{circ}C$ in the air and in vacuum. No recrystallization of original grains occurred, but the dislocation density decreased and newly formed subgrains were observed. The alloy annealed at $1000^{circ}C$ in the air experienced recrystallization and grain growth took place, however annealing in vacuum at $1000^{circ}C$ did not cause the microstructural change. The mechanical property of the alloy was changed slightly with the annealing if the microstructure remained stable. However, the strength of the specimen that was recrystallized decreased drastically.