Crystal structure, thermal expansion, thermogravimetry, thermoelectricity, and electrical conductivity of compositions in the system La0.8Sr0.2Co1-yFeyO3 with 0 less than or equal to y less than or equal to 1 were studied as function of Co/Fe ratio and temperature,:in air. The electrical conduction mechanism is attributed to the adiabatic-hopping of p-type small polarons. At high temperatures, oxygen deficiency causes lattice expansion and a reduction in electrical conductivity. The observed temperature dependence of the Seebeck coefficient is attributed to changes in carrier concentration caused by a thermally excited charge disproportionation of Co3+ ions and by the ionic compensation of induced oxygen vacancies. The measured electrical conductivity and Seebeck coefficient as a function of the Co/Fe ratio is interpreted using a two-site hopping and the site-percolation model. It is suggested that a preferential electronic compensation of Fe ions over Co ions may occur in this system.