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Engines are assigned big subjects such as low emission and low fuel consumption as well as higher output (higher efficiency) in the latest trend of environmental protection. In order to meet these requirements, Air/Fuel ratio of recent high performance engines is being arranged leaner than that of conventional engines. As a result exhaust valve seat inserts used in these engines have problems of their wear resistance because of high exhaust gas temperature. By analyzing wear mechanism under the lean burn conditions, authors developed material for exhaust valve seat inserts which show superior wear resistance under high operating temperature. For the purpose to enhance heat resistance, authors added alloy steel powder for matrix powder and used hard particles which have good diffusion with matrix. The developed material does not include Ni and Co powders for cost saving and has superior machinability.