Precipitation hardening of soft magnetic stainless steel was investigated to achieve both workability (low hardness during machining) and durability (high hardness in practical use) while maintaining soft magnetic properties. NiAl intermetallic compound was used for precipitation hardening. The relationship among aging temperature, microstructure, magnetic properties, and hardness was investigated for 22 composition samples with the basic composition of 15Cr-1Si-2Mo-3Ni-1Al-0.15Ti-bal. Fe (in wt.%) and varying compositions of Si, Mo, Ni, Al, and Cu. The maximum aged hardness was obtained by solution treatment at 1030 °C followed by aging at 550 °C. Soft magnetic properties were achieved with a single-phase ferrite composition (δ: bcc structure), and the hardness level could be adjusted with the concentration of solid solution strengthening elements. Two indexes of the relationship between microstructure and magnetic properties and between solid solution strengthening elements and hardness were obtained. The soft magnetic properties obtained by solution treatment were maintained after aging despite the occurrence of nonmagnetic precipitates of NiAl intermetallic compound. This is because precipitates do not become pinning sites for the domain wall due to their small size and distance between precipitates (1/175 and 1/26 of the domain wall, respectively). As a result, a practical precipitation hardening soft magnetic stainless steel with good properties of 227 HV after solution treatment, 372 HV and a coercive force of 64 A/m after aging treatment was realized.