The structure and magnetic properties of mechanically milled (Nd1-xDyx)(8)Fe88B4(x = 0-1) have been investigated. It was found that suitably annealed samples consisted of a nanocrystalline mixture of magnetically soft alpha-Fe and hard (Nd,Dy)(2)Fe14B. Optimally annealed samples exhibited remanence enhancement and single-phase magnetic behaviour. due to exchange interactions between hard and soft phases. Whilst the remanence decreased with increasing Dy concentration, the coercivity increased. Moreover, as the Dy concentration increased, the magnetic behaviour of the two-phase Nd(Dy)FeB alloys became more sensitive to heat treatment conditions.