Powder precursors of the Al2O3-ZrO2 system were synthesized by the sol-gel method. Dispersity of the powders depended on synthesis and drying conditions. Differential Scanning Calorimetry, X-Ray diffraction, and method of adsorption–desorption isotherms were used to characterize the interrelations between particle size and phase transition in the Al2O3-ZrO2 system. It was revealed that azeotropic drying under overpressure is quite effective for obtaining well-dispersed powder precursors synthesized by the sol-gel method. In contrast to bulk materials, tetragonal, cubic, and monoclinic phases were found to exist in a wider temperature-composition range. It was shown that the existing phase symmetry in the well-dispersed powders correlates with the crystallite size.