The results of experiments show that Nb can significantly lower phase transformation temperature and refined both lamellar space of pearlite and pearlite colony.The refinement on microstructure leads to improvement in steels mechanical properties.However,there is more ferrite formed on grain boundary because of a small amount of Nb addition.To add Cr together with Nb can effectively avoid the formation of ferrite on the grain boundary while microstructure is refined.The results are successfully applied into the development of rail steel U68CuCr which has much higher corrosion resistance as well as better mechanical properties in comparison to conventional rail steel U75V.