The evolution of microstructure, phase composition and physico-mechanical properties of the biocompatible Ti-39Nb-7Zr alloy (wt.%) after severe plastic deformation by rotary forging (RF) was studied using various methods including light optical microscopy, scanning and transmission electron microscopies, X-ray diffraction, microindentation, tensile testing and investigation of thermophysical properties during continuous heating. The hot-rolled Ti-39Nb-7Zr with initial single β-phase structure is subjected to multi-pass RF at 450 °C with an accumulated degree of true deformation of 1.2, resulting in the formation of a fibrous β-grain structure with imperfect 500 nm subgrains characterized by an increased dislocation density. Additionally, nano-sized α-precipitates formed in the body and along the β-grain boundaries. These structural changes resulted in an increase in microhardness from 215 HV to 280 HV and contact modulus of elasticity from 70 GPa to 76 GPa. The combination of strength and ductility of Ti-39Nb-7Zr after RF approaches that of the widely used Ti-6Al-4V ELI alloy in medicine, however, Ti-39Nb-7Zr does not contain elements with limited biocompatibility and has a modulus of elasticity 1.5 times lower than Ti-6Al-4V ELI. The temperature dependences of physical properties (elastic modulus, heat capacity, thermal diffusivity) of the Ti-39Nb-7Zr alloy after RF are considered and sufficient thermal stability of the alloy up to 450 °C is demonstrated.