Mechanical alloying is a powder metallurgy processing technique involving cold welding, fracturing, and rewelding of powder particles in a high-energy ball mill. Mechanical alloying is a non-equilibrium process for materials synthesis. It has been used to obtain nanocrystalline binary Fe-Ni system. Elemental powders of iron and nickel (Fe-50 at.% Ni) have been mixed in a planetary mill. The structural effects of mechanical alloying of powders were investigated by scanning electron microscopy, X-ray diffraction analysis and Mossbauer spectroscopy. It is observed a gradual formation of mixture of phases as fcc (gamma) with a nanoscale grain size. In addition, as the average grain size is decreased with a progressive enlargement of peaks of X-ray diffraction, a paramagnetic phase appears after 48 h of ball milling detected by Mossbauer spectroscopy. (C) 2004 Elsevier B.V. All rights reserved.