The dependence of soft magnetic properties of the Fe73.5Si13.5Nb3Cu1B9 alloy on the 2-hour air annealing temperature Tan at temperatures from 520 to 620°C is studied. It is shown that the magnetic hysteresis loop is significantly broadens and becomes more inclined, and the Curie temperature of the amorphous matrix surrounding α-FeSi nanocrystals decreases with increasing Tan. The atomic structure and phase composition of alloy samples are studied by transmission X-ray diffraction. After annealing at temperatures to 580°C, nanocrystals contain mostly D03 phase (Fe3Si stoichiometry) and are ~7 nm in average size. Their relative fraction in the alloy increases with temperature due to additional iron diffusion from the matrix to nanocrystals. After annealings at Tan > 600°C, the average nanocrystal size increases, and iron boride crystal reflections appear in X-ray diffraction patterns. Degradation of soft magnetic properties of nanocrystalline Fe73.5Si13.5Nb3Cu1B9 alloy with annealing temperature from 520 to 580°C is explained by a decrease in the silicon concentration in FeSi nanocrystals, which results in an increase in the magnetocrystalline anisotropy