Grain boundaries (GBs) are the most abundant structural defects in nanostructured nuclear fuels and play an important role in determining fission product behavior, which further affects the performance of nuclear fuels. In this work, cerium dioxide (CeO2) is used as a surrogate material for mixed oxide fuels to understand gaseous fission product behavior, specifically Xe. First-principles calculations are employed to comprehensively study the behavior of Xe and trap sites for Xe near the Σ3 (111)/[11¯0] grain boundary in CeO2, which will provide guidance on overall trends for Xe stability and diffusion at grain boundaries vs in the bulk. Significant segregation behavior of trap sites, regardless of charge states, is observed near the GB. This is mainly ascribed to the local atomic structure near the GB, which results in weaker bond strength and more negative segregation energies. For Xe, however, the segregation profile near the GB is different. Our calculations show that, as the size of trap sites increases, the segregation propensity of Xe is reduced. In addition, under hyper-stoichiometric conditions, the solubility of Xe trapped at the GB is significantly higher than that in the bulk, suggesting higher Xe concentration than that in the bulk. The results of this work demonstrate that the diffusion mechanism of Xe in CeO2 is comparable to that in UO2. The diffusion activation energies of Xe atoms in the Σ3 GB are lower than that in the bulk CeO2. These results suggest that the diffusivity of Xe atoms is higher along the GB than that in the bulk, which enhances the aggregation of Xe atoms near the GB.