Rare earth compounds as modifiers used widely in modern friction materials can enhance the interracial binding of constituents of materials and improve the comprehensive properties of materials evidently. However, there are still few reports on application of rare earth in automotive friction materials. In order to study the effect mechanism of rare earths in friction materials, a rare earth compound was selected as additive and the effects of materials doped with or without rare earth on friction and wear properties of materials were studied. The microstructure and worn surface morphology were observed by scanning electron microscopy and the macro performance was discussed. Worn surface element constitution of materials was analyzed by energy dispersive spectroscopy. Effect mechanism of rare earths on friction and wear behaviors of friction materials were discussed. The results show that doping rare earths in friction materials can stabilize friction Coefficient, lower the wear rate of materials and increase the impact strength of materials. The flexibility and fracture resistance of materials is greatly improved. Worn surface of materials doped with rare earth is compact and the surface adhesion is greatly enhanced.