Magnetocaloric effect of low-purity Gd0.95Nb0.05 alloys after arc-casting and 400 oC, 1 h heat treatment was studied by X-ray diffraction technique, direct magnetocaloric effect measuring instrument and vibrating sample magnetometer (VSM). The results show that proper amount of Nb addition doesn’t change the Curie temperature of Gd but obviously improves its magnetocaloric effect. The maximum adiabatic temperature change of Gd0.95Nb0.05 alloys increases to 3.5 K from 3.1 K in 1.2 T magnetic field, higher than that of commercial low-purity Gd. Meanwhile the maximum magnetic entropy of Gd0.95Nb0.05 alloys reaches to 3.99 J/(kg·K) in 1.5 T magnetic field. After 400 oC, 1 h heat treatment, Curie temperature of Gd0.95Nb0.05 alloys increases by 2 K, the maximum adiabatic temperature change increases to 3.6 K in 1.2 T magnetic field, and the maximum magnetic entropy also increases to 4.09 J/(kg·K) in 1.5 T magnetic field. Gd0.95Nb0.05 alloys are a potential candidate of magnetic cooling materials with relatively low cost in commercial field.