Abstract: We report improved results of atomistic modeling of V-Fe alloys. We introduced an electronic structure embedding approach to improve the description of the point defects in first-principles calculations, by including the semicore electrons in some V atoms (those near the interstitial where the semicore levels are broadened) but not those further from the point defect. This enables us to combine good accuracy for the defect within large supercells and to expand the data set of first-principles point defect calculations in vanadium with and without small amounts of iron. Based on these data, previous first-principles work, and new calculations on the alloy liquid, we fitted an interatomic potential for the V-Fe system which describes the important configurations likely to arise when such alloys are exposed to radiation. This potential is in a form suitable for molecular dynamics (MD) simulations of large systems. Using the potential, we have calculated the migration barriers of vacancies in the presence of iron, showing that these are broadly similar. On the other hand, MD simulations show that V self-diffusion at high temperatures and Fe diffusion are greatly enhanced by the presence of interstitials.