Here we report the AC magnetic properties of soft magnetic nanocomposites made from compaction of Fe10Co90 nanoparticles. Following a discussion of previous work on soft magnetic nanocomposites, the sample preparation and experimental characterization by AC permeametry are described. The permeability is constant and equal to the DC value for low frequencies, but drops off sharply above a characteristic frequency fc. A model is developed to explore the relation between fc and material parameters including the effective anisotropy, exchange coupled volume, temperature, and saturation magnetization.