The aluminothermic reduction is a highly exothermal reaction between a metal oxide and aluminium. Conventionally this reaction is ignited by an electric resistance and the reaction products after cooling are in the form of a rigid block of mixed metal and aluminium oxide. In this work a new process of aluminothermic reduction is presented, in which the reaction is ignited by a hydrogen plasma. The niobium oxide and aluminium powders are high energy milled for six hours to form particles constituted of oxide and aluminum. Stoichiometric, substoichiometric and superstoichiometric mixtures were prepared. The mixture was placed in a stainless steel tube (the hollow cathode) inside the reactor chamber. The chamber was firstly evacuated. Then hydrogen at low pressure was introduced. In the following an electric discharge between the cathode and the anode localized just above the cathode ignites the plasma. The plasma heats the particles on the surface of the powder layer and starts the reaction that proceeds in each particle since the reactants are intimately mixed. The heat generated by the reaction propagates deeper in the layer until the whole mixture reacts. Substoichiometric mixtures can be used because hydrogen takes part of the reduction. The Nb2O5 – Al starting powder mixture and the products of the reaction are characterized by laser grain size measurement and X-Ray diffraction (XRD). The products are in form of powder or agglomerates of particles. Phases of reaction products was determined by XRD analysis and the particle size trough SEM.