Abstract: The influences of trace amounts of Nd on the microstructure of Sn-6.5Zn-xNd (x=0, 0.1, 0.5), especially on the characteristics of intermetallic compound (IMC) and the bonding performance, were investigated using SEM,EDS and tensile-shearing testing. The results indicate that the modification effect was obvious when a trace amount of Nd was added into the Sn-6.5Zn alloy, which can be attributed to the formation of a fine and uniform IMC layer at the interface. The increment of Nd addition had no obvious effect on the size and distribution of IMC at the interface. With the addition of 0.1wt.% Nd, the bonding performance of the soldered joint improved markedly, but the binding ability of the soldered joint reduced because of the segregation of the Nd-rich phases in the interface when 0.5wt% Nd was added in Sn-6.5Zn alloy.