The present manuscript probes the decomposition behaviour of the ferromagnetic binary metastable Heusler alloy in the Al–Mn system. The ferromagnetic ordered tetragonal phase (L10, popularly known as τ phase), which is metastable in nature, was synthesised from the melt through a copper mould chill casting process using 10-mm diameter mould. Isothermal and non-isothermal heat treatments were carried out to understand the decomposition sequence of τ phase at high temperatures. The metastable phase undergoes, on heating, a eutectoid-like decomposition of τ→ βMn + γ2, where γ2 is the intermetallic phase Al8Mn5. Both the phases are present in the equilibrium diagram. The two phases at higher temperature further transform to a single phase ε having a hexagonal structure. We show through in situ X-ray diffraction studies that γ2 transforms to a disordered bcc phase (γbcc) prior to the transformation to the ε-phase. The overall sequence of phase decomposition during heating can be given as τ→ τ+ β→ β+ γ2→ β+ γbcc→ ε. The high-temperature γbcc phase cannot be retained through quenching experiment and its existence can only be established by in situ studies. © 2016, Springer Science+Business Media New York.