Japan Atomic Energy Agency (JAEA) has started to study and develop zirconium carbide (ZrC) coated fuel particles for advanced high temperature gas cooled reactors. The ZrC coating layer has been fabricated using the bromide process at JAEA. The coated particles with IPyC layers reported in a previous study were annealed at around 2073 K for I h, under which compact sintering will be done in a practical process, in order to study effects of the heat treatment (annealing) on their microstructure evolution. Then the microstructures of the ZrC layers in the cases (batches) of C/Zr = 1.11 and 1.35 were characterized by means of TEM and STEM. Microstructural evolution such as changes in the shape and size of voids or free carbons region caused by the heat treatment were found in the cases of both batches. After the heat treatment, the voids or free carbons region showed a clod like feature with diameters of 50 to 100 rim. The grain growth of ZrC was also observed in both cases: In the ZrC layer with C/Zr = 1.11, the fibrous carbons grew as if to stand from the PyC to ZrC layers on some places in the IPyC/ZrC boundary. [doi: 10.2320/matertrans.M2009185]