The steel powder materials for high strength sintered steel are classified into pre-alloyed and diffusion-alloyed powder. It is known that the powder with the composition of Fe-4%Ni-1.5%Cu-0.5%Mo is the typical diffusion-alloyed powder. This powder has high compressibility, and sintered tensile strength reaches 600MPa class due to martensitic microstructure. However this powder is high cost because of 6% alloy elements. On the other hand, pre-alloyed powder can be manufactured by steel making raw materials, therefore low cost can be achieved. However it has less compressibility due to hardened particles by solute elements. Hence various pre-alloyed powder have been proposed for each PM parts. Kobe Steel, Ltd. have several grades of pre-alloyed powder which contain Mo and both Ni and Mo as alloy elements. In this study, Mo alloy element was optimized to achieve both high tensile strength and low cost. The developed material properties were discussed.