Lead zirconate titanate (PZT) ceramics were co‐fired with pure Ag powders at 1200°C for 1 h, and the ferroelectric and piezoelectric properties of the resultant PZT/Ag composites were evaluated, aimed at potential applications in functionally graded piezoelectric actuators with enhanced mechanical reliabilities. In the range of 1–15 vol% Ag concentration, pure Ag powder remained as the second phase in the composites, and a small quantity of Ag entered into the crystal lattice of PZT and slightly increased the lattice constants of a and c. The Ag powders were found to aggregate together and grow to larger particles in the composites. The ceramic grains grew from an initial size of 1.5 μm for monolithic PZT to 2.5 μm for the PZT/Ag composites, and the grain size was almost the same for various Ag concentrations. It was found that the ferroelectric and piezoelectric properties decreased when Ag was added to PZT. In the range of 1–15 vol% Ag concentration, the remanent polarization Pr decreased from 38 to 27 μC/cm2, the piezoelectric constant d33 decreased from 394 to 105 pC/N, and the planar electromechanical coupling factor kp decreased from 0.69 to 0.15, respectively. These piezoelectric properties of the present PZT/Ag composites were compared with the results reported for PZT/Pt composites, and discussed in relation to microstructural features.