This study investigates the impact of alloying elements, grain size, particle size, and spark plasma sintering (SPS) on the maximum permeability of iron-nickel nanocrystalline powders. The results show that increasing nickel content generally decreases permeability, except in the case of 50wt% Ni–Fe powder mixtures, where particle size effects dominate. Permeability is found to be grain size-dependent, with a critical grain size range of 20–30 nm, below which single-domain grains form, leading to increased permeability. However, permeability decreases with decreasing particle size, exhibiting a stepped pattern likely due to surface defects. Notably, the 40wt% Ni–Fe SPS sample exhibits a high permeability value of 6.2 × 10^-3 emu/Oe after 32 h of milling, with optimal grain sizes ranging from 425 to 475 nm for 40 and 75wt% Ni–Fe SPS alloys. Article Highlights: Nickel content generally decreases permeability, except in specific Ni–Fe mixtures with dominating particle size effects. Grain size below 30 nm boosts permeability due to the formation of single-domain grains. Optimizing grain size and sintering can significantly enhance the magnetic performance of Ni–Fe alloys.