Abstract The paramagnetic susceptibility of four PdAgFe alloy series containing 1, 3, 5 and 7 at. % Fe have been measured between 20° and 150 °C. On the basis of a band filling model the local moment contribution to the susceptibility has been evaluated according to a Curie -Weiss law. Assuming that the iron atoms donate 3 electrons and the silver atoms 1 electron to the Pd 4d band, the effective magnetic moments and the paramagnetic Curie temperatures of all the alloys can be represented by a single curve against the electron concentration. The effective magnetic moment is consistent with an Fe moment of 5.92 μB localized on the iron sites and a Pd moment varying with electron concentration and temperature. The same turns out to be true for the ferromagnetic region where the saturation moment, obtained on PdFe alloys and a PdAgFe alloy by different authors, is considered to arise from a localized Fe moment of 5 μB and a concentration dependent Pd moment. The molecular field coefficient for the interaction between the Fe moments and the Pd 4d electrons is found to be 850 mol/cm3 at 385 K and 1200 mol/cm3 at 0 K. Finally, the iron moment suggested in this work is contrasted with the moment derived from neutron diffraction measurements.