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Phosphorous is an important alloying element in powder metallurgy applications. It is used in Powder metal parts for effective Sintering, dimensional stability, improved machinability, corrosion resistance etc. However it does have some negative effects on properties of Powder metal parts. The purpose of the paper is to study the effect of phosphorous on Powder metal gear of Mix A and Mix B having identical composition differing only in phosphorous content. The samples were detailed on each stage, viz. sintering & Heat treatment. In addition two defective samples were studied to observe the extent to which phosphorous may deteriorate the Powder metal Gear.