In order to put the plastic working of ceramics into practice by utilizing superplastic phenomena it may be quite important to clarify much fundamental data, especially variations in mechanical and material properties caused by superplastic deformation. In the present study, the uniaxial compressive deformation of 3Y-TZP is examined under proper superplastic conditions, the microstructural evolution, the cavitation behavior, etc., caused by the deformation being observed. Then correlations amongst the microstructural evolution, the cavitation and the mechanical properties are considered. At an early stage of the compressive deformation, an increase in the apparent density of the specimen, probably due to the shrinkage of residual pores contained in the specimen before the deformation, is observed and as a result the hardness of the specimen increases, whilst the fracture toughness estimated by the indentation fracture (IF) method varies only slightly. As the compressive strain increases further, cavities—which may be produced by grain boundary sliding and/or oxidation of carbon contained in the specimen—are formed and grown mainly at grain boundaries. As a result the hardness begins to degrade whilst contrarily to this the fracture toughness improves to some extent. An explanation for the improvement in the fracture toughness can be given as follows: a stress concentration at the propagating brittle-crack front would be relaxed by grain-boundary cavities which are dispersed almost uniformly in the speciment. It is concluded from the present study that the superplastic forming of 3Y-TZP under a compressive stress can be performed without many serious problems, since the degradation of the mechanical properties after the superplastic compressive deformation is almost negligible if the final compressive strain is at least −1.0, which may be a sufficient amount of strain for practical plastic working.