Amorphous alloys with nominal composition of Ni40Fe40P14B6are shown to respond to annealing in a magnetic field. Coercive forces are reduced by a factor of 10 to 50 during annealing of straight ribbons to values of 0.003 Oe, as low as ever reported for potentially useful materials. Concurrently the ratio of the magnetization in 1 Oe applied field, to saturation, increases from about 0.5 to 0.95. These changes during annealing correlate with measured stress relief changes. It thus appears that most of the strain-magnetostriction contribution to the anisotropy is removed during annealing. Magnetic annealing at temperatures as low as 100°C results in noticeable changes in properties. From measurements transverse to the magneticaliy induced anisotropy axis, the induced anisotropy is calculated to be about 800 ergs/cm3, considerably smaller than obtained in crystalline Ni50Fe50. This field-induced anisotropy is reversible in direction and magnitude by reheating the sample to its Curie temperature and then cooling in a field. Annealing of 1.5 cm diameter toroids, made from 50 μm thick tapes, increases the initial permeability by more than a factor of 10 and decreases losses by more than a factor of 10. Losses and permeabilities after heat treatment compare favorably to the Permalloys with similar saturation magnetizations.