We undertook a novel batch production approach for the synthesis of CeO2 nanopowders doped with rare earth elements. Solid solution nanopowders of Ce1−xLaxO2−δ (x = 0.15) were successfully synthesized in a large-scale and low-cost production by hydrolyzing and oxidizing Ce-La-C alloys at room temperature and subsequent calcining of their powders at different temperatures (873–1073 K) for 1 h. The Ce-La-C alloys were prepared in a vacuum induction melting furnace. The final products were characterized by x-ray diffraction, transmission electron microscopy, Brunner–Emmet–Teller (BET) surface area analyzer, and Raman spectroscopy. The calculated lattice parameters of the cubic fluorite-type phase of CeO2 tended to increase when La3+ was incorporated into CeO2. The F2g band shift and the absence of a peak corresponding to La2O3 in the Raman spectra consistently confirmed the incorporation of the La3+ ion into CeO2, and the formation of Ce1−xLaxO2−δ solid solutions as manifested by increased oxygen vacancy defects. High-quality Ce1−xLaxO2−δ nanopowders of ~10–15 nm diameter with a high BET surface area of ~77 m2 g−1 were obtained. The average crystallite size of Ce1−xLaxO2−δ was found to be smaller than that of CeO2 for the same calcination temperature of 1073 K, demonstrating that the introduction of La3+ into CeO2 can stabilize the host lattice and refine the grain size at high temperatures.