A systematic study of the YBa2Cu3Oy(YBCO)/Ag2O composite shows that the presence of Ag at high temperature is to stabilize the superconducting YBCO phase. Ag is believed to serve as catalyst which causes partial melting of YBa2Cu3Oyphase at 985 °C and aided grain growth. Some of Ag particles were trapped in the grain or at grain boundaries during rapidly grain growth process and resulted as pinning centers. For the strong pinning samples, two distinguished resistive transitions attributed to the intra‐grain and the inter‐grain region are observed. Thermally activated flux creep is insignificant in these samples.