Determination of seismic sources is the first step in probabilistic seismic‐hazard analysis (PSHA); however, this step, especially in low seismic regions, is often controversial. In conventional PSHA procedure, determination of seismic sources is merely based on the subjective judgments of experts, and in many cases, there are great differences among proposed seismic models in a specific region. As a result, one important source of uncertainty in PSHA is due to determination of seismic sources. In this article, by combination of fuzzy clustering analysis and Monte Carlo simulation, an objective method for determination and probabilistic modeling of seismic sources is presented. By clustering spatial locations of earthquakes, it is possible to specify the extent of each seismic source in an objective way. A cluster quality index is used to identify the optimum number of clusters. The density and spread of events in each cluster determines the geometrical shape of seismic sources. Moreover, in this article a method is proposed to construct spatial probability density functions (PDFs) of earthquake locations based on the results of fuzzy clustering analysis. The spatial PDF of earthquakes can be used for the generation of synthetic events in Monte Carlo simulation. The Azarbaijan region, with its varied seismotectonics and generally high seismicity, is used as an important area of seismicity in which to develop and demonstrate the application and capability of fuzzy clustering analysis in specifying seismic sources. The PSHA is performed for the city of Tabriz, and a comprehensive comparison is made between the results of conventional PSHA, ordinary Monte Carlo hazard analysis, and the proposed method. The results indicate there is an objective relationship between observed seismicity and seismotectonic evidences in the region. Moreover, the distribution of synthetic events is highly correlated with the observed seismicity, seismotectonic, and geological information of the region.