New composition gradient solid electrolytes have been designed for application in high temperature solid-state galvanic sensors and in thermodynamic measurements. The functionally gradient electrolyte consists of a solid solution between two or more ionic conductors with a common ion and gradual variation in composition of the other ionic species. Unequal rates of migration of the ions, caused by the presence of the concentration gradient, may result in the development of space charge, manifesting as diffusion potential. Presented is a theoretical analysis of the EMF of cells incorporating gradient solid electrolytes. An analytical expression is derived for diffusion potential, using the thermodynamics of irreversible processes, for different types of concentration gradients and boundary conditions at the electrode/electrolyte interfaces. The diffusion potential of an isothermal cell incorporating these gradient electrolytes becomes negligible if there is only one mobile ion and the transport numbers of the relatively immobile polyionic species and electrons approach zero. The analysis of the EMF of a nonisothermal cell incorporating a composition gradient solid electrolyte indicates that the cell EMF can be expressed in terms of the thermodynamic parameters at the electrodes and the Seebeck coefficient of the gradient electrolyte under standard conditions when the transport number of one of the ions approaches unity.