The microstructure and morphology of nanocrystalline Fe78.4Si9.5B9Cu0.6Nb2.5 alloy powders prepared by ball milling technique were characterized by X-ray diffraction and scanning electron microscopy studies. The effective permeability (mu(e)), quality factor (Q), DC bias property, and core losses of the corresponding powder cores were tested using low capacitance resonator meter and B-H analyzer in the range of 1-1000 kHz. The results show that the relative density and compression strength of the powder cores increased with increasing particle size. Powder cores from large size particles (150-300 mu m) were found to exhibit higher mu(e) and core loss, but lower Q level when compared to samples of small size ones (5-40 mu m). Moreover, the mu e of powder cores with large particles reached a peak value with the addition of 2 wt% glass binder. The Q value was also found to be proportional to the binder content except 10 wt%, while its peak position was shifted toward higher frequency.