Neodymium is a future-oriented material due to its unique properties, and its use is increasing in various industrial fields worldwide. However, the toxicity caused by repeated exposure to this metal has not been studied in detail thus far. The present study was carried out to investigate the potential inhalation toxicity of nano-sized neodymium oxide ($Nd_2O_3$) following a 28-day repeated inhalation exposure in male Sprague-Dawley rats. Male rats were exposed to nano-sized $Nd_2O_3-containing$ aerosols via a nose-only inhalation system at doses of $0mg/m^3$, $0.5mg/m^3$, $2.5mg/m^3$, and $10mg/m^3$ for 6 hr/day, 5 days/week over a 28-day period, followed by a 28-day recovery period. During the experimental period, clinical signs, body weight, hematologic parameters, serum biochemical parameters, necropsy findings, organ weight, and histopathological findings were examined; neodymium distribution in the major organs and blood, bronchoalveolar lavage fluid (BALF), and oxidative stress in lung tissues were analyzed. Most of the neodymium was found to be deposited in lung tissues, showing a dose-dependent relationship. Infiltration of inflammatory cells and pulmonary alveolar proteinosis (PAP) were the main observations of lung histopathology. Infiltration of inflammatory cells was observed in the $2.5mg/m^3$ and higher dose treatment groups. PAP was observed in all treatment groups accompanied by an increase in lung weight, but was observed to a lesser extent in the $0.5mg/m^3$ treatment group. In BALF analysis, total cell counts, including macrophages and neutrophils, lactate dehydrogenase, albumin, interleukin-6, and tumor necrosis factor-alpha, increased significantly in all treatment groups. After a 4-week recovery period, these changes were generally reversed in the $0.5mg/m^3$ group, but were exacerbated in the $10mg/m^3$ group. The lowest-observed-adverse-effect concentration of nano-sized $Nd_2O_3$ was determined to be $0.5mg/m^3$, and the target organ was determined to be the lung, under the present experimental conditions in male rats.