Adding a suitable amount of magnesium to Fe-Cr-Ni-Mn-Mo-V-Nb alloy decreases largesized intragranular lamellae and dentritic lamellae of M23C6, promotes the loss of the coherent relationship between intragranular small M23C6 block and mother phase and causes M23C6 lamellae to become spherical. During long-term ageing, intragranular fine VC precipitate as well as VC particles conglomerate. A mechanism by which some dislocations can cut across the VC particles is suggested. Increase in misfit between VC and austenite is about 1% at 160 p.p.m. magnesium content or after long-term ageing for 1000 h at 650°C. The misfit between VC ribbon precipitated along dislocations and matrix is smaller than that between the VC particles near the ribbons and matrix.