Increasing awareness of climate change has sparked interest in renewable and zero-carbon vector fuels. Ammonia is gaining popularity as a carbon-free fuel that emits no carbon dioxide; however, a large amount of NOx emission during its combustion poses a significant challenge. In the present work, a chemical kinetic study is performed to study the MILD combustion characteristics of NH3/air flames in the N2 and H2O diluted atmosphere at oxygen concentrations, reactant temperatures, and pressure of 11-23%, 1300-1700 K, and 1 atm, respectively. Steam-diluted flames produce less NOx emissions than nitrogen-diluted flames. Furthermore, the exit NOx emissions for nitrogen-diluted flames increase with an increase in oxygen concentration. However, the NOx emissions for steam-diluted flames show non-monotonic behavior, i.e., exit NOx increases up to the oxygen concentration of 21%, and after that, it starts decreasing. Compared to nitrogen-diluted flames, steam-diluted flames exhibit a wider no-ignition regime. In steam-diluted flames, the peak temperature rises less than in nitrogen-diluted flames, corresponding to wider regimes of MILD combustion. Moreover, for steam-diluted flames to achieve MILD combustion at a given oxygen concentration, the reactant temperature must be higher than that for nitrogen-diluted flames.