This study investigated the effects of silver powder modification on intermetallic compound (IMC) formation and silver leaching during soldering at high temperatures. Silica nanoparticles (NPs) were deposited onto a silver powder surface to inhibit silver leaching, which can lead to soldering joint failure during high-temperature soldering. The NPs were deposited through hydrolysis and a condensation reaction of tetraethyl orthosilicate (TEOS) based on the Stöber method. Fourier transform infrared spectroscopy and scanning electron microscopy were used to observe the microstructures of silver powders after the deposition of silica NPs with various TEOS concentrations and various deposition times. As the deposition time increased, the amount of silica NPs on the surface of the silver powder increased. The transmission electron microscopy results show that silica NPs were located at the IMC grain boundaries, which can hinder the dissolution of IMCs by lead-free solder melt along grain boundaries during soldering, retarding silver leaching. The growth kinetics and mechanism of IMCs during soldering were investigated. The results show that the growth of IMCs is mainly dominated by bulk diffusion. The activation energy for IMC growth increased and the growth rate decreased with increasing silica NP addition and deposition time.