The aim of this study was to investigate the effects of the rare earth element neodymium on the phase formation and microstructural development of relaxor ferroelectric lead magnesium niobate, Pb(Mg1/3Nb2/3)O-3 (PMN) system. Perovskite phase PMN powders were prepared using the sol-gel method and the effect of neodymium doping was investigated at different doping levels ranging from 0.1 mol% to 30 mol%. The precursors employed in the sol-gel process were lead (II) acetate, magnesium ethoxide, and niobium (V) ethoxide. All the experiments were performed at room temperature while the calcination temperatures ranged between 800 degrees C and 1,100 degrees C. Results showed that it was possible to obtain the pure perovskite phase at 950 degrees C using the sol-gel method. Nd+3 addition influenced the phase formation and microstructure of the multicomponent system. Pyrochlore was detected along with the perovskite phase above 10 mol% Nd. Results also demonstrated that grain size of the synthesized powders depended on the Nd+3 concentration.