In this paper, the method of “floatation—microwave magnetic roasting—low intensity magnetic separation” which aims to utilize the iron and Nb mineral in the Bayan Obo tailings was investigated. The results show that the method of “floatation—microwave magnetic roasting—magnetic separation” is effective and simple, and the recovery of iron and Nb in the whole process is up to 80% and 68% respectively. The step of microwave magnetic roasting is researched carefully, and the best magnetic roasting result is obtained at 650°C, and the roasting time is 10min.The best result of magnetic separation is obtained at the magnetic intensity of 220KA/m. Iron ore concentrate separated by magnetic separation can be used for iron making directly because the grade can reach about 62~64.4%. And the grade of Nb can reach up to 2.16%.