Stress relief can improve the soft magnetic properties of Fe-based metallic glasses (MGs) and is vital for industrial applications. In this work, we investigated the evolution of soft magnetic properties, relaxation dynamics, and mechanical properties of Fe-based MGs under different applied tensile strains and stress relaxation times. We found that stress relaxation can significantly reduce coercivity Hc by 95% compared with as-quenched state. Furthermore, the coercivity Hc, apparent activation volume Vact and time constant tr all show analogous two-stage variation with annealing time, accompanied by approximate crossovers. This suggests that the microstructure change emerges, further verified by the domain wall motion and the transition from elastic to plastic. These results are helpful in preparing Fe-based MGs with excellent soft magnetic and mechanical properties by controlling the stress relaxation condition.