The recent model of Anderson of the electronic structure of dilute alloys containing magnetic impurities is extended in two points: First, many mutually interacting impurities are considered instead of a single one, and secondly, the s-d exchange interaction is taken into account. The spin polarization of conduction electrons raised by the s-d mixing interaction around an impurity is examined in details. Its spatial behavior is shown to be of the Ruderman-Kittel type in the region sufficiently distant from the impurity. An important theorem is proved about the sum of the magnitudes of a localized d-spin and surrounding conduction electron spin polarization. The effect of the s-d exchange on the spin localization is shown to be significant. The interaction between impurity states mediated by conduction electrons is shown to change the magnitude of each localized moment. The effective magnetic interaction between impurities is also studied. It is shown in some cases that there is a simple relation between these two effects, i.e. between the signs of the molecular field caused by this magnetic interaction and the change in the magnitude of localized moments.