Nickel ions (Ni²⁺) stabilized tetragonal zirconia (t-ZrO₂) nanopowders have been synthesized at constant pH as well as increasing (direct process) and decreasing (reverse process) the pH of the precursor solution step by step, using hydrazine hydrate (N₂H₅OH) as a precipitating agent. The constant pH (at 10) process has a promising effect on the stability of t-ZrO₂ over the direct and reverse processes. The maximum solubility limit of Ni²⁺ in ZrO₂ is less than 20 mol%. XRD results of the Ni²⁺–ZrO₂ systems revealed that the minimum concentrations of Ni²⁺ for stabilizing t-ZrO₂ at 700°C and 800°C are 10 mol% and 20 mol%, respectively. Decrease in cell volume and crystallite size lead to higher strain with the incorporation of Ni²⁺ ions that causes the stabilization of t-ZrO₂ up to 800°C while synthesized using constant pH process.