FeSiB soft magnetic composites (SMCs) were prepared via powder metallurgy. Influences of passivator solvent, content of the passivator as well as annealing temperature on the morphology and properties of the samples have been investigated. Alcohol has been used to dissolve phosphoric acid as the surface passivator and its effect has been compared with water and acetone. The results show that the magnetic powders tend to be oxidized with water, while acetone hinders the complete surface passivation as a result of limited reaction time caused by low boiling point and strong volatility of the acetone. Uniform insulating coating can be achieved using alcohol as the passivator solvent for decreased core loss. With the content of orthophosphoric acid varied between 0.2~0.8 wt% in alcohol, lowest core loss (187 mW/cm₃ measured at 50 kHz, 50 mT) can be obtained with 0.6 wt% of orthophosphoric acid. Annealing temperatures below 400 ℃ are insufficient for complete stress relaxation for the SMCs, resulting in low permeability and high core loss, whle precipitation of the α-Fe phase occurs with annealing temperatures higher than 425 ℃. Optimized properties of the FeSiB SMCs can be achieved by annealing at 400 ℃ for 1 h.