A least square method for separating two broadening effects caused by crystallite and micro-stress has been proposed and was applied to study the micro-structure of hydrogen storage alloys prepared by different methods. Changes of microstructure after activation and lifetime testing in Ni-MH battery have been comparatively investigated. The results show that the effect of activation on microstructure of the negative electrode material is significant. It is also found that the microstructure changes of the material are dependent on the lifetime testing conditions.