Abstract: The preparation of rapidly solidificated high temperature alloy powder of aluminium and iron mixtured with rare earth and its properties have been studied. Powder manufactured by Ar or He gas ultrasonic atomization is of spherical shape and has a cooling speed of 5 × 10³-7 × 10⁶K/s. Cooling speed is mainly affected by particle size. Relatively high cooling speed can be obtained for the powder of the same size when He gas is used as cooling medium. The smaller the powder size is, the finer the structure is and the better the mechanical properties are.