Indium addition in PrCo5 magnets can facilitate their sintering and improve their coercivity significantly. Transmission electron microscope studies showed the presence of indium-rich phase PrCo2In, at the intergranular region in the sintered Pr18Co81.5In0.5 magnets annealed at 800 and 950 °C. Another new ternary phase, Pr3Co9In2, appeared only in magnets annealed at 950 °C. Both of these phases are believed to be helpful to improve the sintering behavior of the magnets. Especially, the Pr3Co9In2 phase is observed in the form of a thin layer along the grain boundaries, which is believed to improve the magnetic performance of the magnet.