The deformation behavior involved in Nb/NiTi composite for biomedical applications within a large macroscopic strain range was investigated by tensile loading–unloading test and in situ synchrotron X-ray diffraction (SXRD). Experimental results show that during loading, the Nb/NiTi composite experiences the elastic elongation of B2-NiTi austenitic, B19′-NiTi martensitic and β-Nb phases, B2 → B19′ stress-induced martensitic (SIM) transformation and tensile plastic deformation of β-Nb phase. During unloading, the deformation behavior involved in Nb/NiTi composite includes the elastic recovery of B2-NiTi austenitic, B19′-NiTi martensitic and β-Nb phases, reverse phase transformation B19′ → B2 and compressive deformation of β-Nb phase. The martensitic transformation in this composite is almost reversible and occurs in a localized manner. These results might contribute to a comprehensive understanding of the deformation mechanism involved in Nb/NiTi composite and shed some light on design and development of novel composites with a combination of good biocompatibility and excellent superelasticity for biomedical applications.