First-principles calculations and the method of climbing-image nudged elastic band were used to investigate the effects of Mo alloying on the structural stability, mechanical properties, and hydrogen-diffusion behavior in the Nb₁₆H phase. The Nb₁₂Mo₄H phase (26.5 at% Mo) was found to be the most thermodynamically stable structure, with a low ΔH_f value (−0.26 eV) and high elastic modulus. Calculations revealed that the tetrahedral interstitial site (TIS) was the predominant location of H in both Nb₁₆H and Nb₁₂Mo₄H phases. The calculated H-diffusion energy barrier and the diffusion coefficient of the Nb₁₂Mo₄H phase were 0.153 eV and 5.65 × 10⁻⁶ cm² s⁻¹ (300 K), respectively, which suggest that the addition of Mo would lead to a lower energy barrier and high diffusion coefficients for the Nb₁₆H phase, thus improving the hydrogen-permeation properties of Nb metal.