Nanocrystalline Nd2Fe17 powders have been obtained by means of high-energy ball milling from nearly single-phase bulk alloys produced by arc melting and high temperature homogenization annealing. The rhombohedral Th2Zn17-type crystal structure of the bulk alloy remains unaltered after the milling process, with almost unchanged values for the cell parameters. However, the severe mechanical processing induces drastic microstructural changes. A decrease of the mean crystalline size down to around 10 nm is observed, giving rise to a considerable augmentation of the disordered inter-grain boundaries. This modification of the microstructure affects the magnetic behaviour of the milled powders, although the magnetic structure remains collinear ferromagnetic. While a unique ferro-to-paramagnetic transition temperature, T-C = 339 +/- 2 K, is observed in the bulk alloy, the nanocrystalline samples exhibit a more likely distribution of T-C values. The latter seems to be responsible for the significant broadening of the temperature range in which magneto-caloric effect is observed, and the lowering of the maximum value of the magnetic entropy change.