The nanocrystalline body-centered-cubic (bcc)-Fe phase was formed by controlled 1 h annealing of the amorphous Fe80.5Nb7B12.5 alloy at temperatures ranging from 490 to 650 °C. The microstructure and magnetic properties of the nanocrystalline alloy were investigated by Mössbauer spectroscopy, differential scanning calorimetry, and quasistatic hysteresis loop measurements. Conventional Mössbauer spectroscopy allowed identification of phases and the determination of their relative content. The specialized radio frequency (rf)-Mössbauer technique, which employs the effects induced by the rf magnetic field (rf collapse and rf sideband effects) allowed us to distinguish the magnetically soft amorphous and nanocrystalline phase from the magnetically harder microcrystalline Fe. The rf-Mössbauer experiments performed as a function of the rf field intensity allowed determination of the anisotropy fields in each phase of the nanocrystalline alloy (amorphous matrix, nanoscale bcc-Fe grains). The measurements of the hysteresis loops versus annealing temperature revealed minimum coercivity (0.15 Oe) at 610 °C. © 1999 American Institute of Physics.