The microstructure of Sm(CobalFexCu0.08Zr0.03)(8.2), where x = 0.23, 0.26, and 0.28, in the as-cast state and after various processing stages has been examined by optical microscopy. The size of the 2:17 matrix phase was found to be approximately 100 mu m in the as-cast state. A slight increase in the size of the 2:17 matrix was observed after thermal processing. Subgrains of 10 to 20 mu m are present in the 2:17 matrix of the fully processed ingots. Powders with a mean particle size range of 3-300 mu m were found to exhibit a Gaussian distribution. A slight increase in intrinsic coercivity (H-ci) was observed when the mean particle size was decreased from 300 to 200 mu m and remained nearly constant for sizes ranging between 10 and 200 mu m. A significant decrease in H-ci was observed when powders were further reduced below 10 mu m. Similar trends were also observed for remanence (B-r), maximum energy product (BHmax), and squareness of the second quadrant demagnetization curve. The size of the subgrains was found to be critical to these properties. The H-ci of alloy powders with a high Fe content appeared to degrade more severely when reduced below 10 mu m. For a fixed mean particle size, alloy powders with a high Fe content also exhibited a less-square second quadrant demagnetization curve. A B-r of 9.2 kG, H-ci of 18 kOe, H-cb Of 7.4 kOe, BHmax of 19 MGOe, and a squareness ratio of 0.91 have been obtained on Sm(CobalFe0.23Cu0.08Zr0.03)(8.2). As expected for alloys with a higher Fe content, B-r of 11.3 kG, H-ci of 20 kOe, H-cb Of 8.1 kOe, BHmax of 25 MGOe, and a square ratio of 0.83 have been obtained on Sm(CobalFe0.28Cu0.08Zr0.03)(8.2). (C) 1997 American Institute of Physics.