The microstructure and hardness of Fe–Co-based Hiperco© alloys were investigated. Scanning electron microscopy revealed elongated grains in the as-received (cast and cold-rolled) alloys, and samples containing Nb had second phase precipitates. Annealing of alloys for 1 to 3 h at temperatures in the range 700 to 800 °C resulted in grains becoming equiaxed. In the Nb-containing alloys, the original precipitates dissolved and new precipitates appeared. The rate of grain growth decreased with increasing Nb content, suggesting that Nb or Nb-containing precipitates were responsible for a reduction in the grain boundary mobility. The hardness as a function of grain size in the annealed samples of all of the alloys could be plotted on the same Hall–Petch curve, indicating that the yield strength of these alloys is governed by the grain size, independent of the alloy composition and volume fraction of precipitates.