The influence of different Y concentrations on the evolution of the structural and mechanical properties of FeCrAl alloys is investigated in this work. The ingot casting process was used to produce alloys with Y mass fractions of 0%, 0.03%, and 0.25%, respectively. They were then annealed for 15 min at 850°C, 950°C, and 1050°C before being quenched by water to room temperature. Microstructure and mechanical properties were analyzed using OM, EPMA, EBSD, and tensile tests. The addition of 0.03% Y to FeCrAl alloy and annealing at 850°C resulted in the greatest overall performance of the alloy. This had a tensile strength of 635.62 MPa, yield strength of 465.48 MPa, and elongation of 27.04%. With an increase in Y concentration or annealing temperature, the tensile, yield, and elongation properties decrease. This phenomenon can be attributed to the incorporation of Y, which creates a fine Y-rich second phase in the alloy. These phases act as heterogeneous nuclei, pinning the grains during solidification, effectively reducing grain growth and refining the grains. Grain refinement and an increase in the number of grain boundaries hinder dislocation movement, thereby enhancing the alloy's tensile and yield strength. Simultaneously, this prevents the disappearance of α-fiber textures and the creation of γ-fiber textures during recrystallization and reduces the strength of the γ-fiber textures in the alloy microstructure. However, as the annealing temperature increases, microstructure grain growth and the number of grain boundaries decrease. Moreover, higher Y concentrations result in the formation of large, striated Fe-Y phases, which impair the forming properties of the alloy and consequently reduce its tensile properties. Therefore, future research should focus on effectively avoiding the formation of coarse second phases in the microstructure of FeCrAl alloy to enhance its overall performance.