We report a systematic study of the influence of Nb substitution for Fe on the magnetic properties and magneto-impedance (MI) effect in amorphous and annealed Fe76.5 - xSi13.5B9Cu1Nbx (x = 0, 1, 2, 3, 4, 5, 6, and 7) ribbons. The amorphous ribbons were annealed at different temperatures ranging from 530 to 560 degrees C in vacuum for different annealing times between 5 and 20 min. We have found that for the asquenched amorphous ribbons, the substitution of Nb for Fe first increases the saturation magnetization (M-s) and decreases the coercivity (H-c) until x = 3, for which the largest M-s similar to 152 emu/g and the smallest H-c similar to 1.3 Oe are obtained, then an opposite trend is found for x > 3. The largest MI ratio (Delta Z/Z similar to 38% at f = 6 MHz) is achieved in the amorphous ribbon with x = 3. A similar trend has been observed for the annealed ribbons. The most desirable magnetic properties (M-s similar to 156 emu/g and H-c similar to 1.8 Oe) and the largest MI ratio (Delta Z/Z similar to 221% at f = 6 MHz) are achieved for the x = 3 sample annealed at 540 degrees C for 15 min. A correlation between the microstructure, magnetic properties, and MI effect in the annealed ribbons has been established. (c) 2012 Elsevier B.V. All rights reserved.