The invention relates to a rare earth alloyed steel, which comprises the following components in percentage by mass: 0.37 to 0.44 weight percent of C, 0.15 to 0.35 weight percent of Si, 0.65 to 1.00 weight percent of Mn, 0.85 to 1.25 weight percent of Cr, 0.15 to 0.25 weight percent of Mo, 0.015 to 0.025 weight percent of S, Ni, P and rare earth alloy, and the balance of iron and impurities, the mass percentage content of Ni is not greater than 0.25%, and the mass percentage content of P is not greater than 0.025%; and the mass percentage content wt of the rare earth alloy is more than 0 and not more than 0.06%. The steel is low in content of low-melting-point impurities, good in fatigue resistance and good in impact toughness. The nitriding method of the steel comprises the steps that the steel is heated to 1050-1250 DEG C, forging, heating, heat preservation, rough machining and heat treatment are conducted, finish machining is conducted, and then nitriding is conducted. The obtained nitrided steel part has good surface hardness, the depth of a hardened layer is appropriate, and the steel part has excellent abrasive resistance and corrosion resistance.