To understand the mechanisms by which the re-solution of Fe and Cr additions increase the corrosion rate of irradiated Zr alloys, the solubility and clustering of Fe and Cr in model binary Zr alloys was investigated using a combination of experimental and modelling techniques — atom probe tomography (APT), x-ray diffraction (XRD), thermoelectric power (TEP) and density functional theory (DFT). Cr occupies both interstitial and substitutional sites in the α-Zr lattice; Fe favours interstitial sites, and a low-symmetry site that was not previously modelled is found to be the most favourable for Fe. Lattice expansion as a function of Fe and Cr content in the α-Zr matrix deviates from Vegard’s law and is strongly anisotropic for Fe additions, expanding the c-axis while contracting the a-axis. Matrix content of solutes cannot be reliably estimated from lattice parameter measurements, instead a combination of TEP and APT was employed. Defect clusters form at higher solution concentrations, which induce a smaller lattice strain compared to the dilute defects. In the presence of a Zr vacancy, all two-atom clusters are more soluble than individual point defects and as many as four Fe or three Cr atoms could be accommodated in a single Zr vacancy. The Zr vacancy is critical for the increased apparent solubility of defect clusters; the implications for irradiation induced microstructure changes in Zr alloys are discussed.