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Peripheral nerve injury (PNI) is a global problem that leads to severe disability and high healthcare expenditure. Accumulating evidence suggested that the phenotypes of Schwann cells (SCs) could be regulated by microRNAs (miRNAs) and expressions of various miRNAs are altered after PNI. In this study, the expression of miR-1b in the injured nerve and hypoxia-treated SCs was detected through qRT-PCR. The target genes of miR-1b were predicted by bioinformatics prediction and dual-luciferase reporter assay and verified through qRT-PCR and western blot. The effects of miR-1b and its specific target gene on the proliferation, migration and apoptosis of SCs were determined and the regulation of miR-1b on peripheral nerve regeneration after PNI was further investigated in vivo. We found that miR-1b was obviously downregulated in the injured nerve in a rat sciatic nerve transection model and directly targeted N-myc downstream-regulated gene 3 (NDRG3) by binding to its 3'-UTR and caused both mRNA degradation and translation suppression of NDRG3. Overexpression of miR-1b or knockdown of NDRG3 decreased the proliferation and migration as well as increased the apoptosis of SCs. NDRG3 reversed the effects of miR-1b overexpression on proliferation/migration/apoptosis of RSC96. In addition, injection of miR-1b antagomir promoted the expression of NDRG3 in the injured nerve following sciatic nerve injury. Compared to the model group, the rats treated with miR-1b agomir had lower functional recovery rate, and downregulation of miR-1b through injection of specific antagomir improved the functional recovery rate according to the results of sciatic functional index and nerve conduction velocity. Overall, our results will contribute to the development of novel targets for promoting nerve regeneration after PNI.