Magnesia, ceria partially stabilized zirconia (Ce,Mg)-PSZ ceramics with net shape microstructure are prepared using a processing method similar to that of conventional Mg-PSZ ceramics, then heat-treated at 1500°C for different time. Microstructure and phase composition of (Ce, Mg)-PSZ samples with different amount of CeO2 doped were investigated using SEM and X-ray diffraction. The addition of CeO2 could impede the formation of monoclinic phase and inhibit the growth of cubic grains. A microstructure with net-shape cubic grains, in which tetragonal precipitates interweave to a nanoporous structure is obtained by adding 4∼8 mol% CeO2 in 10mol% MgO doped zirconia matrix and then heat treatment at 1500°C for different time. The precipitate morophology might be related with the addition of CeO2 and the heat treatment temperatures.