The structure and dielectric properties of perovskite Ag(Nb0.8Ta0.2)O3 ceramics were explored. A small amount of Bi2O3 was used to modify the dielectric properties of the ceramics. The addition of Bi2O3 led the ceramics to a high densification and optimal dielectric properties. With the addition of 4.5 wt% Bi2O3, the permittivity of Ag(Nb0.8Ta0.2)O3 ceramics increased from 470 to 733, the dielectric loss decreased from 62×10−4 to 6.7×10−4, and the temperature coefficient of capacitance, TCC, decreased from 2004 ppm/°C to −50 ppm/°C. The high permittivity obtained was due to the high densification and weak Ta-O or Nb-O bond strength in the oxygen octahedron that results from the addition of Bi2O3.