In all previous studies of soft magnetic alloys, magnetic softness is obtained through forming a completely amorphous state via rapid solidification, such as by melt spinning at a high cooling rate followed by annealing, typically at 600 °C, to develop a magnetically isotropic nanostructure. Fine powdering of the annealed alloy via ball milling is then required for manufacturing, net shaping, and 3D printing. However, the soft magnetic properties are susceptible to the subsequent processing conditions, characterized by significantly increased coercivity. Herein, nanoscale crystallites are obtained directly from the melt‐spun Fe77Ni5.5Co5.5Zr7B4Cu ribbon (i.e., not through annealing of a completely amorphous ribbon) that exhibits structural stability during the annealing and ball‐milling processes. The melt‐spun ribbon annealed at high temperatures (700 °C) remains magnetically soft with Hc of ≈0 Oe, which is a key property for high‐temperature applications. Ball milling of the annealed melt‐spun samples results in fine powders with low Hc values over a wide temperature range up to 427 °C. It is shown that the rapidly solidified crystalline ribbon provides an ideal precursor for the manufacture of high‐temperature soft magnetic materials. This new approach provides a straightforward method of making soft magnetic alloy powders.