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Nd₂O₃ is a structurally and chemically simple material which crystallizes in a trigonal structure, with Nd³⁺ ions surrounded by cages of 7 oxygen anions. Here we study the physical properties of Nd₂O₃ with neutron diffraction, inelastic neutron scattering, heat capacity, and magnetic susceptibility measurements. The inelastic neutron scattering measurements reveal that the crystal field spectrum consists of four excitations spanning the energy range 3-60 meV. The ground state eigenfunction consists of XY-spins in the ab plane. Fits to the magnetic susceptibility data indicate a Curie-Weiss temperature of θ_CW=-23.7(1) K. Neutron diffraction measurements show that long range antiferromagnetic order occurs below T_N=550 mK implying a frustration index of θ_CW / T_N ~43. These results suggest that Nd₂O₃ may be a model system for competing interactions between magnetic moments subject to strong spin-orbit coupling.