Conventional magnetostriction materials have some practical disadvantages. In order to develop a new magnetostriction alloy having no such disadvantages, the Fe‐Pd alloy system has been investigated. The value of longitudinal linear magnetostriction &lgr; depends sensitively on the heat‐treatment conditions. In the cooled state from 900 °C, the concentration dependence of &lgr; at room temperature takes a pronounced maximum at 33% Pd, indicating about 85×10−6at 500 Oe. Cold working such as swaging has been easily performed.