NiTi shape memory alloy is one of the promising orthopedic materials due to the unique shape memory effect and superelasticity. However, the large amount of Ni in the alloy may cause allergic reactions and toxic effects thereby limiting its applications. In this work, the surface of NiTi alloy was modified by nitrogen plasma immersion ion implantation (N-PIII) at various voltages. The materials were characterized by X-ray photoelectron spectroscopy (XPS). The topography and roughness before and after N-PIII were measured by atomic force microscope. The effects of the modified surfaces on nickel release and cytotoxicity were assessed by immersion tests and cell cultures. The XPS results reveal that near-surface Ni concentration is significantly reduced by PIII and the surface TiN layer suppresses nickel release and favors osteoblast proliferation, especially for samples implanted at higher voltages. The surfaces produced at higher voltages of 30 and 40 kV show better adhesion ability to osteoblasts compared to the unimplanted and 20 kV PIII samples. The effects of heating during PIII on the phase transformation behavior and cyclic deformation response of the materials were investigated by differential scanning calorimetry and three-point bending tests. Our results show that N-PIII conducted using the proper conditions improves the biocompatibility and mechanical properties of the NiTi alloy significantly.