Ni-Mn-Ga Ferromagnetic Shape Memory Alloy (FSMA) has been prepared by melt casting technique. The alloy was annealed at different temperatures. The samples are characterized in prepared condition and after three different annealing treatments. Microstructure of the alloy has been investigated using SEM at room temperature. Microstructure study reveals that the magnetic domains run diagonally across the surface. Differential Scanning Calorimetry (DSC) result shows the ferromagnetic transition temperature of the alloy is 105°C. In-situ study of structure during heating has revealed that the martensite to austenite transformation takes place in the temperature range of 28°C to 36°C. The present study focuses the effect of annealing on phase transformation and magnetic transformation temperature of Ni-Mn-Ga alloy. It has been observed that the thickness of the martensite plate increases as the alloy is annealed at 950°C for 30 hrs.