Precisely refined Mossbauer study and nano structure observation revealed that intergranular phase formed between a-Fe and Nd₂Fe₁₄B phase in NdFeNbB alloys plays a significant role on the magnetic properties. The intergranular interaction was characterized in term of Henkel Plot (δM plot), and hyperfine field, quardrupole splitting and isomer shift were refined to predict the presence and role of the intergranular phase. By the addition of Nb into Nd₈Fe₈₆B₆ composition, coercivity was found to increase by 25% due to the refinement of average grain size of both the soft and hard magnetic phases which was decreased from 50 nm of virgin Nd₈Fe₈₆B₆ to 25 nm in Nd₈Fe ₈₅Nb₁B₆ alloys. The role of Nb addition was confirmed to stabilize the Nd₂Fe₁₄B lattice preventing from thermal vibration of the corresponding sites substituted Fe by Nb atoms in all sites in the Nd₂Fe₁₄B lattice. The enhanced coercivity was originated from the exchange hardening of soft and amorphous phases surrounding the hard magnetic Nd₂Fe₁₄B crystal.