The influence of Nb content on the microstructure and cryogenic mechanical properties of a 7%Ni steel was investigated within the Nb content range from 0 to 0.05%. The microstructure was characterized by optical microscope, scanning electron microscope, transmission electron microscopy and X-ray diffraction, and the low-temperature mechanical property tests were conducted. The Nb addition can effectively refine the prior austenite grains and microstructure of the steel. Fine niobium precipitates with a diameter of about 10–50 nm were observed. They tend to be spherical and locate mainly in the vicinity of grain boundaries. Although there are considerable amounts of reversed austenite forming at grain boundaries in the specimen containing the highest Nb content, no Nb element was detected in such reversed austenite, which implies that Nb element did not affect the formation of the reversed austenite directly. Mechanical test results suggest that the strength of the 7%Ni steel is not simply in relation to the prior austenite grain size, but also depends on the amount of reversed austenite. On the other hand, the grain refinement, enhanced with increasing Nb content, has a good effect on cryogenic toughness.