Nimotuzumab and Nivolumab in Treating Patients With Advanced Non-small Cell Lung Cancer

Inclusion Criteria:

* Eastern Cooperative Oncology Group (ECOG) performance status of =\< 2
* Patients with pathologically confirmed non-small cell lung cancer
* Patients must have had progressive NSCLC after first-line platinum-based chemotherapy for advanced disease
* Have at least 3 months life expectancy
* Have measurable disease per RECIST 1.1 criteria present
* Patients with adenocarcinoma known to have anaplastic lymphoma kinase (ALK) rearrangements and/or epidermal growth factor receptor (EGFR) mutations that have had prior EGFR or ALK tyrosine kinase inhibitor therapy and have progressed, will also be eligible, regardless of line of therapy
* Phase I optional archival tissue/phase II mandatory archival tissue: able to provide enough biopsy tissue samples including primary diagnostic biopsy (archival), re-biopsy tissues (archival from time of disease progression/recurrence following first-line treatment failure) at disease progression to determine PD-L1 and EGFR expression and other biomarkers
* Absolute neutrophil count (ANC) \>= 1.5 x 10\^9/L
* Platelets \>= 100 x 10\^9/L
* Hemoglobin \>= 9 g/dL
* Serum creatinine =\< 1.5 x institution upper limit of normal (ULN)
* Alanine aminotransferase (ALT) and aspartate aminotransferase (AST) =\< 1.5 x ULN or =\< 5 x ULN if liver metastases are present
* Total serum bilirubin =\< ULN; or total bilirubin =\< 3.0 x ULN with direct bilirubin within normal range in patients with well documented Gilbert's syndrome
* Troponin-I, CK-MB +\< BNP \<200pg/ml
* LVEF \>= LLN
* Participants of child-bearing potential must agree to use adequate contraceptive methods (e.g., hormonal or barrier method of birth control; abstinence) prior to study entry; should a woman become pregnant or suspect she is pregnant while she or her partner is participating in this study, she should inform her treating physician immediately
* Participant or legal representative must understand the investigational nature of this study and sign an Independent Ethics Committee/Institutional Review Board approved written informed consent form prior to receiving any study related procedure

Exclusion Criteria:

* Active autoimmune disease that has required systemic treatment in past 2 years; use of inhaled corticosteroids is allowed
* Phase II only: history of other malignancies are allowed as long as the current disease stage that did not require active treatment with concomitant systemic cytotoxic chemotherapy, targeted therapy, investigational or biologic therapy (e.g., anti-CTLA4 or HER2 monoclonal antibodies) within 12 months prior to study registration and, is not likely to require systemic therapy in the next 12 months; hormone-related therapies (e.g., somatostatin analogues, etc.) are allowed on a case-to-case basis upon discussion with principal investigator
* Active clinically serious infections requiring antibiotics, antiviral or antifungal agents
* Symptomatic brain metastases; uncontrolled pleural effusion, seroperitoneum, or pericardial effusion
* Has had any major surgery, chemotherapy, or radiotherapy within the previous 4 weeks; gamma knife radiosurgery for brain metastases within less than 2 weeks
* Receiving other anti-cancer medical treatment during the study outside of the nimotuzumab or nivolumab
* Clinically significant interstitial pulmonary disease or known diagnosis of interstitial lung disease (ILD)
* Has known immunosuppressive disease (e.g. human immunodeficiency virus \[HIV\], acquired immune deficiency syndrome \[AIDS\])
* Patient has known hypersensitivity to the components of the study drugs or their analogs
* Patient with uncontrolled cardiac disease or cardiac dysfunction, including any of the following:

  * History of uncontrolled angina pectoris that does not respond to medical intervention
  * Symptomatic pericarditis or myocardial infarction within 12 months prior to study entry that did not respond to treatment
  * History of documented congestive heart failure (New York Heart Association functional classification III or IV)
  * Documented cardiomyopathy
  * Uncontrolled hypertension defined by: systolic blood pressure (SBP) \>= 160 mmHg and/or diastolic blood pressure (DBP) \>= 100 mmHg
* Pregnant or nursing female participants
* Unwilling or unable to follow protocol requirements
* Any condition which in the investigator's opinion deems the participant an unsuitable candidate to receive study drug