The effect of small addition of niobium on the mechanical properties of grain boundary allotriomorphic ferrite (FGBA)/ granular bainite (BG) air cooling bainitic steel has been investigated by tensile test, Optical Microscopy (OM), and scanning electron microscopy (SEM) observation. The results show that (1) The small addition of niobium improves the mechanical properties of the FGBA/BG steel obviously. Compared with Non-Nb FGBA/ BG steel, 0.02% Nb increases the tensile strength and yield strength about 20% (From 780Mpa to 937Mpa)and 17%(From 557Mpa to 650Mpa) respectively, remaining 18% elongation. (2) With the addition of 0.02%Nb, both the size and the volume fraction of FGBA decrease. Meanwhile, the volume fraction of refined intragranular ferrite and M-A islands increases. Compared with Non-Nb steel, the volume fraction of M-A island in 0.02Nb steel increases from 21% to 31%, and the average size of M-A island decreases from 1.2μm to 0.95um.(3)It is indicated that the small addition of Nb(0.02%) not only refines the allotriomorphic ferrite grain but also promotes the nucleation of intragranular ferrite, both of which in turn contribute to the refinement of granular bainite cluster including its ferrite platelets and M-A islands. (4)It is suggested that the strengthening effect of 0.02%Nb can be mainly attributed to the segregation of Nb to γ/α phase boundaries(solute drag-like effect) rather than the precipitation strengthening of Nb(C,N). Nb enrichment in the α/γ interphase causes the decrease of C-activities and activity gradient in the austenite matrix around the α/γ interphase and thus causes the decrease of C-diffusion rate in austenite, and further the restraint to ferrite growth. The effects also depress bainite transformation temperature and driving force, as a result, the bainite cluster is refined.