The results of a detailed investigation of electrical resistivity, ρ (T) and transverse magnetoresistance (MR) in nanocrystalline Gd samples with an average grain size d= 12 nm and 18 nm reveal the following. Besides a major contribution to the residual resistivity, ρ r (0), arising from the scattering of conduction electrons from grain surfaces/interfaces/boundaries (which increases drastically as the average grain size decreases, as expected), coherent electron–magnon scattering makes a small contribution to ρ r (0), which gets progressively suppressed as the applied magnetic field (H) increases in strength. At low temperatures (T≲ 40 K) and fields (H= 0 and H= 5 kOe), ρ H (T) varies as T 3/2 with a change in slope at T+≃ 16.5 K. As the field increases beyond 5 kOe, the T 3/2 variation of ρ H (T) at low temperatures (T≲ 40 K) changes over to the T 2 variation and a slight change in the slope dρ H/dT 2 at T+(H) disappears at H⩾ 20 kOe. The electron–electron scattering (Fermi liquid) contribution to the T 2 term, if present, is completely swamped by the coherent electron–magnon scattering contribution. As a function of temperature,(negative) MR goes through a dip at a temperature T min≃ T+, which increases with H as H 2/3. MR at T min also increases in magnitude with H and attains a value as large as∼ 15%(17%) for d= 12 nm (18 nm) at H= 90 kOe. This value is roughly five times greater than that reported earlier for crystalline Gd at T min≃ 100 K. Unusually large MR results from an anomalous softening of magnon modes at T≃ T min≈ 20 K. In the light of our previous magnetization and specific heat results, we show that all the above observations, including the H 2/3 dependence of T min (with T min (H) identified as the Bose–Einstein condensation (BEC) transition temperature, T BEC (H)), are the manifestations of the BEC of magnons at temperatures T⩽ T BEC. Contrasted with crystalline Gd, which behaves as a three-dimensional (3D) pure uniaxial dipolar ferromagnet in the asymptotic critical region, ρ H= 0 (T) of nanocrystalline Gd, in the critical region near the ferromagnetic-paramagnetic phase transition, is better described by the model proposed for a 3D random uniaxial dipolar ferromagnet.