Formation of nanocrystals in the BiO-FeO system prepared by the co-precipitation of bismuth and iron hydroxides has been studied. The temperature of onset of the BiFeO and BiFeO nanocrystals formation is correlated with the melting point of the non-autonomous phases. The optimal temperature of BiFeO and BiFeO nanoparticles synthesis is 460-520 and 500-550°C, respectively.