Lead-free 0.77(Bi0.5Na0.5)TiO3-0.23Sr(Ti1-xFex)O-3 (x=0, 0.04) (BNT-23STF(x)) was prepared using a conventional solid-state reaction route. The effects of Fe-modification on the chemical homogeneity from a m scale perspective, the core-shell domains structures, and the ferroelectric properties were investigated. The chemical homogeneity was analyzed using energy dispersive X-ray mapping in scanning transmission electron microscopy mode, and the field-dependent behaviors of strain and polarization were obtained to determine the ferroelectric properties. Substituting Fe3+ for Ti4+ resulted in completely different electrical behavior and properties, despite similar XRD patterns and microstructures. The Fe-substitution promoted the mobility of Sr2+ ions in the BNT phase and, as a consequence, the chemical homogeneity increased and the core-domains collapsed. Extending the ceramic processing, such as milling time and sintering time, affected domain distribution and compositional inhomogeneity, which led to a gradual transformation from ferroelectric to relaxor.