This study endeavors to investigate the feasibility of in situ synthesis of nitrides and oxides within Fe-12Cr-6Al alloys through precise modulation of reactive gas atmosphere during the Laser-Powder Bed Fusion process. A focused study on elucidating the effects of critical process parameters, such as laser power, scanning speed, and hatch distance, was undertaken to discern their impact on the material's microstructure, oxygen/nitrogen content, and hardness. Synthesis of nano-sized AlN and Al2O3 precipitates within the Fe-12Cr-6Al matrix was achieved when nitrogen was used for a process gas. A rise in laser power from 120 W to 200 W, coupled with a reduction in scanning speed from 1200 mm/s to 400 mm/s, resulted in decreased porosity and an increase in grain size. Additionally, all printed samples showed lower oxygen content compared to the initial powder, while nitrogen ratios were notably higher. A marginal increase of the Vickers hardness value, from 240 ± 4.5 to 266 ± 3 HV, was observed as the laser power increased and the scanning speed decreased. The hardness values were higher than those obtained from different production methods with identical compositions. These compelling results suggest a positive impact of nitride precipitates and oxide precipitates to improve hardness values.