Ceria-stabilized tetragonal zirconia (Ce-TZP) has become an interesting alternative for the widely used yttria-stabilized zirconia (Y-TZP), whereas efforts are needed to control its microstructure in order to improve the strength of Ce-TZP ceramics. In this work, CaO was used to co-dope Ce-TZP ceramics. More specifically, 0.2–2.0 mol% Ca(NO3)3·4H2O precursor-based CaO was used to dope 10 mol% ceria-stabilized zirconia. Sintering was performed at 1300, 1350, or 1400 °C, which is lower than the temperatures commonly applied for zirconia ceramics. The microstructure and mechanical properties were investigated and correlated, revealing that 0.2 mol% CaO-doped CeO2-stabilised zirconia sintered at 1350 °C exhibited a fully dense fine-grained tetragonal ZrO2 microstructure with high toughness (10.4 MPa m1/2) and biaxial bending strength (1210 ± 43 MPa), and a narrow strength distribution (weibull modulus of 32.5). 1.5 and 2.0 mol% CaO-doping resulted in excellent biaxial bending strength but wider strength distribution and lower fracture resistance. The homogeneously distributed Ca(NO3)3·4H2O precursor prevented cubic zirconia-phase formation for CaO-doping up to 2.0 mol%. CaO-doped (≥ 0.2 mol%) 10Ce-TZP sintered at 1350 °C also highly resisted hydrothermal degradation. Furthermore, CaO-doping enabled to make Ce-TZP ceramics as translucent as different commercially available 3Y-TZP ceramics, opening possibilities to use Ce-TZP for dental restorations.