The invention discloses a method for preparing high-performance iron nickel magnetically soft alloy by using a powder metallurgy process, which belongs to the technical field of powder metallurgy. The method comprises the following steps of: 1, uniformly mixing various powder such as iron powder, nickel powder, molybdenum powder, silicon powder, copper powder, cobalt powder, chrome powder, niobium powder, tungsten powder, aluminum powder and titanium powder according to a certain ratio, wherein the nickel content ranges from 30 to 78 percent; or the alloy powder prepared according to a certain alloy component ratio is directly used as a raw material; 2, forming the powder which is obtained by step 1 into a blank with a certain shape by using a powder metallurgy forming method; 3, sintering the formed blank, which is obtained by the step 2, under the pressure of between 0 and 1,000 MPa and at the temperature of between 600 and 1,500 DEG C for 10 to 4,000 minutes; and 4, processing the sintered body obtained by the step 3 under the pressure of between 0 and 4,000 MPa and at the temperature of between 600 and 1,600 DEG C for 0 and 4,000 minutes. The method has the characteristic that: by improving the sintering and thermal treatment systems, the material density is improved, the micro texture and structure of the material are improved, the impurity content is reduced, and the magnetically soft alloy product with the maximal magnetic conductivity of no less than 40 mH/m and with the coercive force of no more than 20 A/m can be prepared.