In this paper, for an arbitrary Kac-Moody Lie algebra g and a diagram automorphism µ of g satisfying two linking conditions, we introduce and study a µtwisted quantum affinization algebra U (ĝµ) of g. When g is of finite type, U (ĝµ) is Drinfeld's current algebra realization of the twisted quantum affine algebra. And, when µ = Id, U (ĝµ) is the quantum affinization algebra introduced by Ginzburg-Kapranov-Vasserot. As the main results of this paper, we first prove a triangular decomposition of U (ĝµ). Second, we give a simple characterization of the affine quantum Serre relations on restricted U (ĝµ)-modules in terms of "normal order products". Third, we prove that the category of restricted U (ĝµ)-modules is a monoidal category and hence obtain a topological Hopf algebra structure on the "restricted completion" of U (ĝµ). Fourth, we study the classical limit of U (ĝµ) and abridge it to the quantization theory of extended affine Lie algebras. In particular, based on a classification result of Allison-Berman-Pianzola, we obtain the -deformation of nullity 2 extended affine Lie algebras.