We report on the effect of α-Fe₂O₃ phase in the magnetic properties and magnetic interactions in nickel ferrite (NiFe₂O₄-NFO) nanoparticles synthesized by co-precipitation method. Structural analysis confirms the formation of the cubic inverse spinel phase without any impurities for the NFO sample annealed in air at 650 °C. When the annealing temperature is increased to 750 °C and 850 °C, α-Fe₂O₃ impurity phase is formed along with the parent NFO phase. Raman spectra recorded at room temperature (RT) confirm the presence of pure NFO phase for the sample annealed at 650 °C, and presence of α-Fe₂O₃ phase is observed in the samples annealed at 750 °C and 850 °C. Saturation magnetization values at RT for the NFO samples annealed at 650 °C, 750 °C and 850 °C are 34 emu/g, 19 emu/g and 28 emu/g respectively. Zero Field Cooled (ZFC) and Field Cooled (FC) measurement reveals the super-paramagnetic behavior along with competing magnetic interactions in all the samples. For the NFO sample annealed at 750 °C and 850 °C, a drop in ZFC magnetization and a small kink in FC magnetization observed around 245 K indicate the presence of a Morin transition (TM) from the α-Fe₂O₃ phase. Anisotropy constants were calculated for all the samples using the law of approach to saturation (LAS) method. The magnetocrystalline anisotropy energy distribution function for the NFO samples annealed at 750 °C and 850 °C exhibit broad peak due to the random distribution of spins associated with different particle size.