Nd2Fe14B hard magnetic nanoparticles were synthesized by chemical synthesis techniques. Nd−Fe−B gel was prepared using NdCl3·6H2O, FeCl3·6H2O, H3BO3, citric acid, and ethylene glycol (EG) by a Pechini type sol−gel method. This gel was subsequently annealed to produce mixed oxide powders. Nd2Fe14B nanoparticles were prepared from these oxides by a reduction−diffusion process. The phase analysis, structure, and magnetic properties were determined by Fourier transform infrared spectroscopy (FTIR), nuclear magnetic resonance (NMR), X-ray diffraction (XRD), field emission scanning electron microscope (FESEM), transmission electron microscope (TEM), and vibrating sample magnetometer (VSM) techniques. The mechanism of Nd2Fe14B formation was investigated by differential scanning calorimetry (DSC), XRD, and thermodynamic free energy change data. Our experimental and modeling results showed that the reduction−diffusion of the Nd−Fe−B mixed oxide was a three step process. The reduction of Fe2O3 to Fe and B2O3 to B occurred at 300 °C. NdH2 and Fe was formed from Nd2O3 and NdFeO3 at 620 °C. The Nd2Fe14B phase was formed from NdH2, Fe, and B at 692 °C. The coercivity of as-synthesized powder was 6.1 kOe. The Henkel plot showed that this powder was exchange coupled; removal of CaO by washing led to dipolar interactions and a decrease in coercivity.