Close-coupled gas atomization is extensively used in the industrial production of alloy powders due to the advantages of high efficiency, low cost and excellent powder properties. In order to investigate the complex gas-liquid interaction during atomization, primary atomization was simulated through the VOF (Volume of Fluid) model and the dynamic adaptive mesh method, and a two-way coupling DPM (Discrete Particle Model) was used to simulate secondary atomization. The results showed that under the low melt mass flow rate of 0.0050 kg s−1, the flow separation and droplet backflow occurred at the atomization pressure of 1 MPa, while gas-liquid interfaces deformed and rotated drastically when the atomization pressure is above 3 MPa, which led to the formation of hollow powders. When the melt mass flow rate was 0.0150 kg s−1, the d50 decreased from 40.7 to 38.4 μm as the atomization pressure increased from 2 to 3 MPa. However, the chance of collision between particles increased due to the decrease in the spray cone angle, and both the standard deviation of particle size and atomization efficiency deteriorated, which indicated that 2 MPa was the optimum atomization pressure. As the mass flow rate increased from 0.0050 to 0.0150 kg s−1, the gas to melt ratio decreased, but the d50 only increased from 32.3 to 40.7 μm, indicating that the mass flow rate of 0.0150 kg s−1 did not significantly affect the particle size distribution, but also contributed to improve the production efficiency and avoided the risk of the nozzle freeze-off. The d50 of the spherical FeSiAl powders produced by the industrial tests at 2 MPa and 0.0150 kg s−1 was 44.7 ± 2.1 μm, which was basically consistent with the simulation results, indicating that the parameter optimization by the coupling model developed in this study could provide theoretical and practical guidance for the preparation of high-performance alloy powders by gas atomization.