The structure of PSZ crystals has been studied as a function of the content of the stabilizing impurity (Y2O3) by X –ray diffraction, transmission electron microscopy (TEM) and atomic−force microscope (AFM). The hardness and fracture toughness have been measured by microindentation. The study has shown that PSZ crystals obtained by directional solidification of the melt consist of two tetragonal phases (t and t’) with varying degrees of tetragonality. Increasing the stabilizing impurity concentration leads to an increase in the volume fraction of the “untransformable” t’ phase. Experiments have shown that an increase in the concentration of the stabilizing impurity leads to a growth in the amount of positively charged oxygen vacancies (the F++–centers) which increase the lattice parameter and stabilize the structure. The character of the twinned structure changes depending on the concentration of the stabilizing impurity. In PSZ crystals with Y2O3 concentration from 2.8 to 3.2 mol. % twins first, second and third orders as well as large twins consist of smaller twin domains are observed. At high concentrations of stabilizing impurities (3.7—4.0 mol. %) the twin structure becomes smaller and more uniform. This suggests that twinning occurs simultaneously and is localized within small volumes. The character of the twinned structure changes depending on the concentration of the stabilizing impurity. This work shows that the quantity of hardening (fracture toughness) is proportional to the content of the transformable t phase.