A new lead-free perovskite solid solution (1-x)BaTiO3-xBi(Mg1/2Zr1/2)O-3 with morphotropic phase boundary (MPB) has been developed, and its structural and dielectric properties have been investigated. Rietveld structural analysis of the X-ray diffraction data suggest a composition-dependent tetragonal (P4mm) to cubic (Pm3m) phase transition with an intermediate, phase coexistence region, demarcating the MPB. The compositions with x 0.05 are tetragonal in the P4mm space group and the compositions with x 0.25 are cubic in the space group. Coexistence of monoclinic phase (space group Cm) with tetragonal/cubic phase (space group P4mm/Pm3m) is observed in the MPB region for the compositions with 0.10 x 0.22. The temperature dependence of permittivity exhibits a nonrelaxor type diffuse phase transition for all the compositions across the MPB.