To improve the plastic deformation capacity of the immiscible Cu-7Fe alloy, this study investigated the effects of Ag and Al additions on the stacking fault energy (SFE) and microstructural properties by combining first-principles calculations with experimental methods. The results demonstrate that both Ag and Al effectively modified the morphology and distribution of the second phases in the Cu-Fe alloy. Specifically, the addition of Ag eliminated coarse dendritic Fe phases, while the addition of Al promoted the spheroidization of some Fe phases. In terms of mechanical properties, the addition of Ag increased the alloy strength from 308 MPa to 318 MPa and the elongation from 30