The influence of magnetic field annealing on the saturation magnetostriction and μi–T curves for the nanocrystalline (Fe0.5Co0.5)73.5Cu1Nb3Si13.5B9 alloy was investigated. In contrast to the nonmagnetic field annealing, the magnetic field annealing reduces λS and remodels the μi–T curves of the samples dramatically. After nonmagnetic annealing at different temperatures, the λS of samples increases with the annealing temperature (Ta), and the value of μi decreases with T increasing at different rates. However, the λS of magnetic annealed samples decreases with increasing Ta because of the ordered rearrangement of the magnetic domain along with the applied field direction. The μi of magnetic annealing samples tends to increase with Ta, but it behaves in a different fashion with increasing T, which is correlated with the lower magnetostriction and the induced uniaxial anisotropy by magnetic annealing.