An improved form of the Tietz potential for diatomic molecules is discussed in detail within the path integral formalism. The radial Green's function is rigorously constructed in a closed form for different shapes of this potential. For |q| ≤ 1, and 1 2α ln |q| < r < +∞, the energy spectrum and the normalized wave functions of the bound states are derived for the l waves. When the deformation parameter q is 0 < |q| < 1 or q > 0, it is found that the quantization conditions are transcendental equations that requires numerical solutions. In the limit q → 0, the energy spectrum and the corresponding wave functions for the radial Morse potential are recovered.