Nanostructured isotropic Nd–Fe–B magnets with enhanced remanence were produced by hot compaction of mechanically alloyed Nd–Fe–B powders at temperatures of about 600 °C. Phase formation occurred during hot pressing without significant grain growth. The microstructure is a two phase nanocomposite of hard magnetic Nd2Fe14B and soft magnetic &agr;‐Fe with an average grain size of about 20 nm. These small dimensions allow effective exchange interactions between hard and soft magnetic grains and result in an enhancement of the remanence by more than 30% above the Stoner–Wolfarth limit expected for noninteracting single domain particles. So far, the best results are a remanence of 1.0 T, an energy density of 121 kJ/m3, and a coercivity of 4.2 kA/cm for a Nd–Fe–Co–Si–B magnet. ©1995 American Institute of Physics.