The crystallization behavior of heat treated amorphous Fe40Ni38B18Mo4 alloy was studied by TEM in order to investigate the suitability of this material as a soft nanostructured magnetic alloy. Significantly, the phases observed during primary and secondary crystallization were nanosized Fe-Ni solid solution and (FeNiMo)(23)B-6, respectively. The primary crystals had an unusual irregular morphology due to the presence of molybdenum. A twinned structure was observed by nanobeam diffraction within the Fe-Ni nanocrystals. The phase transformation mechanism was compared with that of Fe40Ni40B20 and Fe40Ni40P14B6 alloys and the differences were analyzed from a thermodynamic point of view. The magnetic properties, M-s and H-c, were studied by VSM, it was found that improved soft magnetic properties were achieved by heat treatment. A mean crystal size of 10 nm and a volume fraction of 1% was found to be the microstructure which would yield the lowest coercivity. (c) 2005 Elsevier B.V. All rights reserved.