A series of MoO 3–ZrO 2 nanocomposite oxides with MoO 3 content in the range of 2–20 mol% were prepared by solution combustion method. Three different fuels namely urea, glycine and hexamethylenetetramine (HMTA) were used for the preparation of MoO 3–ZrO 2 oxides. For the sake of comparison, the MoO 3–ZrO 2 composite oxides were also prepared by impregnation of zirconia with molybdenum salt precursor and subsequent heat treatment. The synthesized nanomaterials were characterized by XRD, SEM, TEM and UV–vis spectroscopic technique. XRD study indicated selective stabilization of the tetragonal phase of zirconia in the presence of MoO 3. The method of preparation was found to be crucial for the phase composition of zirconia in the composite oxide. The crystallite size and rms stain were calculated from the Fourier line shape analysis of the broadened X-ray diffraction profiles. With increase in the MoO 3 content, the crystallite size of the tetragonal zirconia phase was found to be decreased. TEM study indicated the presence of small nanoparticles with size in the 5–10 nm range. UV–vis study of the composite oxide materials revealed well dispersion of the molybdenum oxide component in the form of monomer, dimers and nanoclusters in the zirconia matrix. The nature of fuel was found to be crucial in determining the morphology and shape of the particles.