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Thermoelectric properties of the hot-pressed p-type (Bi0.25Sb0.75)2Te3 alloy were characterized with variation of the hot-pressing temperature and the starting powder size. The roles of the factors which affect the Seebeck coefficient of the hot-pressed (Bi0.25Sb0.75)2Te3 alloy has been elucidated in this study. The donor-like behavior of oxygen could be one of the possible explanations for the higher Seebeck coefficient of the hot-pressed (Bi0.25Sb0.75)2Te3 alloy. Te vacancies formed by mechanical deformation during the powdering process significantly promote the diffusion of second phase Te atoms into their lattice sites so that the matrix Te solubility approaches its equilibrium value at a given temperature in a relatively short length of time. Using the Seebeck coefficient at various hot-pressing temperatures, the micro-phase diagram near the stoichiometric composition of (Bi0.25Sb0.75)2Te3 was evaluated.