First-principles, spin-polarized local-density-functional calculations are used to model interstitial iron (Fei) and its complexes with substitutional aluminum in dilute SixGe1−x alloys (x<8%). We considered both the effect of direct bonding between Fei or FeiAl with Ge atoms in the x0 limit and the evolution of the defect properties with the alloy composition. It is found that Fei prefers Si-rich regions, but when placed near a Ge atom, its (0/+) level is shifted toward the conduction band. However, the ionization energy of Fe(+/+2)-Al− is only slightly changed by the presence of neighboring Ge atoms in the proximity. It is also found that indirect alloying effects shift the donor levels of Fei and FeAl at a fast rate toward the valence band. The acceptor levels, however, remain approximately at the same distance from Ev.