The step of preparing a rapidly solidified alloy by rapidly quenching a melt of an R-T-B-C based rare-earth alloy (where R is at least one of the rare-earth elements including Y, T is a transition metal including iron as its main ingredient, B is boron, and C is carbon) and the step of thermally treating and crystallizing the rapidly solidified alloy are included. The step of thermally treating results in producing a first compound phase with an R.sub.2Fe.sub.14B type crystal structure and a second compound phase having a diffraction peak at a site with an interplanar spacing d of 0.295 nm to 0.300 nm (i.e., where 2.theta.=30 degrees). An intensity ratio of the diffraction peak of the second compound phase to that of R.sub.2Fe.sub.14B type crystals representing a (410) plane is at least 10%. The present invention provides an R-T-B-C based rare-earth alloy magnetic material, including carbon (C) as an indispensable element but exhibiting excellent magnetic properties, and makes it possible to recycle rare-earth magnets.