Thermal electrical resistivity, magnetic hysteresis and magneto-impedance behaviour of melt spun and annealed Co71-XFeXCr 7Si8B14 (X = 0, 2, 3.2, 4, 6, 8 and 12 at.%) were investigated. The addition of Fe in the system changed crystallization as well as the magnetic properties of the materials. The alloy containing 6 at.% Fe showed an increase in resistivity during the first crystallization process. A TEM micrograph indicated the formation of nanostructure during the crystallization process. The GMI properties of the alloys are evaluated at a driving current amplitude of 5 mA and a frequency of 4 MHz. The two-peak behaviour in the GMI profile was observed for all the samples. It is found that the alloy with 4 at.% Fe has the maximum GMI ratio because of the nearly zero magnetostriction value of the sample. About 62% change in the GMI ratio was observed in the alloy with 4 at.% Fe when annealed at 673 K. The anisotropy field was also minimum for the annealed alloy. The results were explained by the formation of directional ordering and the reduction of the magnetostriction constant of the alloy due to nanocrystallization during the annealing process. © 2006 IOP Publishing Ltd.