Nanocrystalline Ni0.5Zn0.5Fe2O4 spinel ferrite with a grain size of 50 nm was prepared by using the ceramic method. The grain size was further reduced to 14 nm by milling the as-prepared ferrite particles in a high-energy ball mill. From the impedance spectroscopy studies we have observed that the dc electrical conductivity increases upon milling. Furthermore, the cation distribution data, as obtained from the in-field Mössbauer and extended x-ray absorption fine structure measurements, suggested a decrease in the conductivity for the milled sample. The increase in conductivity of the milled sample is, therefore, attributed to conduction by the oxygen vacancies created by mechanical milling. The higher values obtained for the activation energy for conduction are also evidence for the oxygen vacancy conduction. The increase in Néel temperature from 573 to 611 K on reducing the grain size from 50 to 14 nm has been explained based on the changes in the cation distribution. The observed increase in the coercivity of the milled sample has been attributed to surface anisotropy of increasing number of ions on the surface. The Mössbauer spectra show canted spin structure for the milled samples.