Nd 8 Fe 86−x Nb x B 6 (x = 0, 1, 2, 3) nanocomposite magnet has been studied by Mössbauer spectroscopy and nanostructure observation. It was found that intergranular phase formed between α-Fe and Nd 2 Fe 14 B phase in NdFeNbB alloys plays a significant role on the magnetic properties. By the addition of Nb into Nd 8 Fe 86 B 6 composition, coercivity was found to increase by 25% due to the grain refinement of both the soft and hard magnetic phases which was decreased from 50 nm of virgin Nd 8 Fe 86 B 6 to 25 nm in Nd 8 Fe 85 Nb 1 B 6 alloys. The role of Nb addition was confirmed to stabilize the Nd 2 Fe 14 B lattice preventing from thermal vibration of the corresponding sites at where Fe atoms are substituted by Nb in the Nd 2 Fe 14 B lattice. The enhanced coercivity was originated from the exchange hardening of soft and amorphous phases surrounding the hard magnetic Nd 2 Fe 14 B crystal.