Based on the quantum theory, a detailed theoretical analysis of both the magnetic and magneto-optical properties of NdF3 is developed. Using the one-ion model, the choice of the crystal field parameters plays a crucial role. The reasons for the 4.2K isothermal M(H) curve intersecting with the 1.6K M(H) curve, and for the nonlinear relation between the Faraday rotation and the magnetic field at low temperature, are that the lowest three crystal fields and spin-orbit interaction split levels are not only split, but also strongly mixed with each other by H. Other specific properties like the magnetic susceptibility anisotropy in the 4.2–1100K temperature range are also well interpreted.