Abstract Amorphous FeSiB/Ni-Zn ferrite soft magnetic composites (SMCs) with significantly improved permeability and core loss were fabricated in an external magnetic field during the compression molding. Amorphous FeSiB was selected because of its excellent loss performance in kHz frequency, while Ni-Zn ferrite was selected as insulating layer because of its high permeability and high resistance. A magnetic field was applied along the direction parallel or perpendicular to the magnetic circuit plane of the SMCs during the preparation process. The permeability, core loss, and DC-bias performance of the parallel-oriented SMCs were significantly improved, compared to those perpendicular-oriented and those without magnetic field, which were mainly attributed to the optimization of the microstructure and magnetic circuit by the parallel orientation of the field. The results suggest the soft magnetic performances of SMCs can be further improved by utilizing magnetic field during the preparation process.