Abstract: The present invention is directed to an alloy for a high-performance rare earth permanent magnet. This alloy has a metallographic structure of approximately two phases that comprises a Nd2Fe14B phase (1) consisting of hard magnetic crystal grains and an &agr;-Fe phase (2) consisting of soft magnetic crystal grains. The metallographic structure has an ultra-thin film (3) that contains a large amount of nonmagnetic metallic elements that have an atomic radius of between the atomic radius of Fe and the atomic radius of Nd at each of the crystal grain boundaries between the phases (1, 2) and that will not form solid solutions with either Fe or Nd. The nonmagnetic metallic elements consist of one or two or more elements selected from among Nb, Zr, Ta and Hf, the thickness of each ultra-thin film is 10 to 20 angstroms, and the sizes of the crystal grains in each of the phases (1, 2) are in the range 5 to 100 nm, preferably 10 to 40 nm.