In the present paper, structural, magnetic and magnetostrictive properties of Tb1−xGdxFe2 (0 ≤ x ≤ 1.0) were studied. Synchrotron x-ray diffraction (XRD) results show the non-cubic symmetry of Tb1−xGdxFe2 at room temperature and composition-induced crystallographic phase transition from rhombohedral phase to tetragonal phase. The Gd concentration dependent lattice parameters, lattice distortion and change of easy magnetic direction were detected by synchrotron XRD. With the Gd concentration increases, Curie temperature Tc increases while room temperature magnetization and magnetostriction coefficient λ111 and the anisotropy of TbFe2 decrease. The decrease in spontaneous magnetostriction coefficient λ111 with increasing Gd substitution can be understood on the basis of the single-ion model; the corresponding decrease of magnetostriction for Tb1−xGdxFe2, and the large magnetostriction value occurs on the Tb-rich side, are ascribed to decrease of λ111.