Depending on the energy level used during mechanical alloying, the constitution of the resulting products can vary extensively. With high energy input, full transformation to the equilibrium phase, FeTi, is achieved. In contrast, for low levels of energy input, the process is akin to mixing without any phase transformation even for extended milling periods. In the present work, nanostructured FeTi powders were produced by mechanical alloying, avoiding the unfavourable agglomeration problem, by using a relatively low level of energy (e.g. 300 rpm) to mill the pure metallic constituents, Fe and Ti, followed by subsequent heat treatment at 800°C. A major achievement of this research was to show that, by modulating the milling intensity and total milling time, the high temperature synthesis reaction of FeTi (1100°C) can be partially or totally suppressed, reverting instead to a metastable reaction path at low temperature (650°C). The mechanical “activation” modifies the reactivity of the system, producing a very thin Ti /Fe layers. That in conjunction with a high level of defects induced mechanically may be responsible for the metastability. Partial substitution of Fe with Ni (10%) resulted essentially in the same phase constitution, indicating solid solution of Ni in FeTi replacing partially Fe lattice positions.