We report on the formation and chemical leaching of non-equilibrium alloy produced by rod milling. X-ray diffractometry, transmission electron microscopy, differential scanning calorimetry, scanning electron microscopy, and vibrating sample magnetometry were used to characterize the as-milled and leached specimens. After 400 h, only the peak of the body-centered cubic type was present in the XRD pattern. The entire rod milling process could be divided into three different stages of milling: agglomeration, disintegration, and homogenization. The saturation magnetization, decreased with increased milling time, the of the powders before milling was about 113.8 emu/g, the after milling for 400 h was about 11.55 emu/g. Leaching of the Al in KOH of the Al at room temperature from the as-milled powders did not induce any significant change in the diffraction pattern. After the leached specimen had been annealed at for 1 hour, the nanoscale crystalline phases were transformed into the bcc Fe, cubic Co, and phases. On cooling the specimen from 85, the degree of magnetization increased slightly, then increased sharply at approximately 364.8, indicating that the bcc phase had been transformed to the Fe and Co phases.