The n-type Co-doped β-FeSi2 (Fe0.98Co0.02Si2) with dispersion of an electrically insulating SiO2 and conductive TiO was synthesized by mechanical alloying and subsequent hot pressing. The effects of these oxide dispersions on the thermoelectric properties were investigated. When the SiO2 powder was added, the thermal conductivity (thermal diffusivity) was significantly reduced and the electrical resistivity slightly increased. On the other hand, in the case of the TiO addition, the electrical resistivity decreased compared to that of the sample without addition. The addition of a small amount of SiO2 or TiO was also found to enhance the Seebeck coefficient in the low temperature range. In order to disperse finer SiO2 particles, the addition of Fe2O3, Si, and Co powders to the Fe–Si powder was tried. The precipitation of fine SiO2 particles through a reaction of these additives was significantly effective for enhancing the phonon scattering. © 2004 American Institute of Physics.