A novel low NOx oil burner of 0.7 MW (for a 1 ton steam/hr industrial boiler) was designed and tested to investigate the combustion characteristics through in-flame measurement and flue gas analysis. Flame shape was observed by CCD camera and $CH^*/{C_2}^*$ radical distribution in the flame were observed, along with measurement of flue gas composition such as NOx and CO, for various heat inputs, excess airs and pressure of the fuel spary nozzles. The flame showed the two-zone structure: fuel-rich and fuel-lean zone, which was very favorable for the low-NOx combustion, and the NOx emission for haevy oil combustion was significantly reduced to < 150 ppm at 4 % $O_2$, compared with the NOx level of a conventional heavy oil burner.