The use of inverse magnetostriction effect is a possible approach for the applications of actuator, sensor and energy harvester. A strong textured Fe100-xCox (x = 70 mol%) magnetostrictive alloys have been studies as a new smart material. The design of microstructure plays important roles in performance enhancement of power generation by heat-treatment at several temperatures from 420℃ to 850℃. Experimentally, the effect of heat-treatment on their microstructures was evaluated by laser microscope and X-ray diffraction and orientation analysis. Furthermore, the magnetic, magnetostrictive and electric power generation characteristics were investigated by vibrating sample magnetometer (VSM), single-axis strain gauge and drop impact test, respectively. These results indicated the lattice strain in the crystal grain was related to the coercivity resulting from the domain wall mobility in the materials. Moreover, the orientation aligned by the drawing process was related to the magnetostriction. Also, the large grain width, that is, low grain boundary density was strongly attributed to enhance the magnetostrictive susceptibility. The output power calculated from the output waveform was reached up to 91 mJ/s for 820℃-WQ (water quenching) resulting from the high magnetostrictive susceptibility as well as the quenching effect from the temperature near the (bcc + fcc)/bcc interface. These results indicated that it is important to control not only the annealing conditions for improving magnetostrictive susceptibility but also the control of residual stress or grain boundary density for developing higher performance of output characteristics.