The n-type Co-doped beta-FeSi2 (Fe0.98Co0.02Si2) with dispersion of several oxides, such as ZrO2 or several rare-earth oxides (Y2O3, Nd2O3, Sm2O3 and Gd2O3), was synthesized by mechanical alloying and subsequent hot pressing. The effects of these oxide dispersions on the thermoelectric properties of Fe0.98Co0.02Si2 were investigated. ZrO2 was decomposed in the beta phase, and the ZrSi and epsilon-FeSi phases, which are metallic phases, were formed in the samples with ZrO2 addition. The Seebeck coefficient and the electrical resistivity were significantly decreased with increasing amount of ZrO2, indicating that a part of the Zr atoms was substituted for Fe atoms in the beta phase. In the case of the samples with rare-earth oxide addition, a decomposition of a large amount of these added oxides did not occur. However, the rare-earth oxide addition caused a slight increase in the amount of the epsilon phase. The Seebeck coefficient was significantly enhanced by the rare-earth oxide addition especially in the low temperature range. These facts indicated that a small amount of rare-earth oxides was decomposed in the beta phase, and rare-earth elements were substituted for Fe atoms as a p-type dopant, resulting in the decrease in the carrier concentration. The rare-earth oxide addition was also effective in reducing the thermal conductivity. (C) 2002 Elsevier Science B.V. All rights reserved.