The microstructures and mechanical properties of an Fe-Ni-Cr austenite alloy undergone different ageing treatments have been examined. The η phase precipitated on the grain boundary of the over-aged alloy. Contrary to be crack sources and make mechanical properties of alloys deteriorate as it has been always considered, η phase was found to have little effect on room temperature properties and furthermore, it improved the high temperature ductility of the alloy via blocking the grain boundary slip due to its coherency with the austenite matrix. SEM fractography shows that the 1023 K tensile fracture transforms from intergranular mode to microvoid coalescence mode due to the presentation of η phase. Addition of Nb causes more dispersed distribution of η phase along grain boundaries and therefore results in higher high temperature ductility.