The magnetic and electronic properties of Ni impurity in bcc Fe ($Ni_1Fe_{26}$) are investigated using the full potential linearized augmented plane wave (FLAPW) method based the generalized gradient approximation (GGA). We found that the Ni impurity in bcc Fe increases both the lattice constant and the magnetic moment of bcc Fe. The calculated equilibrium lattice constant of $Ni_1Fe_{26}$ in the ferromagnetic state was 2.84 A, which is slightly larger than that of bcc Fe (2.83 ${AA}$). The averaged magnetic moment per atom of $Ni_1Fe_{26}$ unit cell was calculated to be $2.24{mu}_B$, which is greater than that of bcc Fe (2.17 ${mu}_B$). The enhancement of magnetic moment of $Ni_1Fe_{26}$ is mainly contributed by the nearest neighbor Fe atom of Ni, i.e., Fe1, and this can be explained by the spin flip of Fe1 d states. The density of states shows that Ni impurity forms a virtual bound state (VBS), which is contributed by Ni $e_{g{downarrow}}$ states. We suggest that the VBS caused by the Ni impurity is responsible for the spin flip of Fe1 d states.