A series of NiO-ZrO2 samples with 2 to 40 mol% of NiO were prepared using a sol-gel synthesis technique and calcined at 873 K. XRD characterization of the samples revealed the stabilization of a cubic zirconia- (fluorite) phase containing nickel oxide up to 20 mol%. Bulk NiO characteristics were observed above 20 mol% loading of NiO. The linear decrease in lattice parameter up to 20 mol% of NiO indicates the probable incorporation of Ni2+ into the lattice position of Zr4+ ions. The NiO-ZrO2 sample with 20% NiO retained its cubic phase even after prolonged heating at 1273 K, indicating 20 mol% as an optimum content of NiO for a thermally stable cubic zirconia phase. The BET surface areas of these samples were in the range of 40 to 70 m(2) g(-1). XPS spectra along with XRD data indicated that at low (5 mol%) concentrations of NiO, Ni2+ enters ZrO2 lattice substitutionally creating oxygen vacancies. TPR of NiO-ZrO2 showed the reduction of nickel oxide at 533 and 633 K, indicating nickel in two different environments, at a substitutional position and at a surface/interstitial position. O-18-isotope exchange studies of these samples showed a partial heterogeneous exchange and the T-onset was found to be lowest for the sample containing 20 mol% NiO. The activity for CH4 and CO oxidation was investigated by O-18-isotope exchange as well as catalytic studies in complete oxidation of CH4 and CO. The activity for CH4 oxidation was highest for the NiO-ZrO2 sample with 20 mol% NiO. CH4 and CO oxidation with O-18 isotope over NiO-ZrO2 catalysts showed the formation of CO2 with O-16 (amu 44), suggesting that the bulk oxygen is acting as an active species for methane oxidation. The structure of NiO-ZrO2 samples with varying NiO content and its correlation with catalytic activity mechanism is discussed. (C) 2003 Elsevier Inc. All rights reserved.