In this research, Ni50Mn34In16 ferromagnetic shape memory alloy has been prepared by mechanical alloying method. XRD patterns of the samples showed that after 10 hours of ball milling, the alloy structure was completely formed and continuing of the milling process led to more fine particle size. Also the role of annealing on improvement of the alloy properties was studied. It was found that the sample annealing at 900ºC followed by quenching improves the crystal structure and helps to reach L21 structure. Ac susceptibility measurements showed that for the occurrence of magnetic transition, annealing and quenching process on the ball milled powder is necessary.