Polycrystalline Fe₈₃Ga₁₇ alloy rods with various amounts of yttrium were prepared by high vacuum induction melting. It is found that yttrium addition has a significant effect on the structure and magnetostriction of Fe₈₃Ga₁₇ alloy. The small addition of yttrium alters the solidification character and the grain shape of Fe₈₃Ga₁₇ alloy, and as a result, columnar grains with the <100> preferential direction are produced. Yttrium addition improves the magnetostrictive performance of the as-cast Fe₈₃Ga₁₇ alloy. The magnetostriction values of the as-cast alloy with 0.32at% and 0.64at% yttrium addition go up to 119×10^-6 and 137×10^-6 under 15 MPa compressive stress, respectively. The energy dispersive spectroscopy (EDS) result shows that almost all of the yttrium atoms exist in the Y₂Fe_17-xGa_x phase. A small amount of this kind of secondary phase cannot obviously increase the saturate magnetic field.