Tetragonal ZrO2 polycrystalline (TZP) ceramics with varying yttria and ceria content (2–3 mol%) and distribution (coated or co-precipitated), and varying second phase content Al2O3 were prepared and investigated by means of microstructural analysis, mechanical properties, and hydrothermal stability, and ZrO2-based composites with 35–60 vol% of electrical conductive TiN particles were developed. The effects of stabilizer content and means of addition, powder preparation, sintering conditions, and grain size have been systematically investigated. Fully dense Y-TZP ceramics, stabilized with 2–3 mol% Y2O3, 2 wt% Al2O3 can be achieved by hot pressing at 1,450 °C for 1 h. The hydrothermal stability increased with increasing overall yttria content. The jet-milled TiN powder was used to investigate the ZrO2–TiN composites as function of the TiN content. The experimental work revealed that fully dense ZrO2–TiN composites, stabilized with 1.75 mol% Y2O3, 0.75 wt% Al2O3, and a jet-milled TiN content ranging from 35 to 60 vol% could be achieved by hot pressing at 1,550 °C for 1 h. Transformation toughening was found as the primary toughening mechanism. The decreasing hardness and strength could be attributed to an increasing TiN grain size with increasing TiN content, whereas the decreasing toughness might be due to the decreasing contribution of transformation toughening from the tetragonal to monoclinic ZrO2 phase transformation. The E modulus increases linearly with increasing TiN content, whereas the hydrothermal stability increases with addition of TiN content.