Mesoporous Ce_0.2Zr_0.8O₂ nanosized powders were synthesized via a hydrothermal method in the presence of urea without any templates using a trivalent cerium salt as the starting material. The analyses by medium-angle powder X-ray diffraction (PXRD) and vis-Raman spectroscopy showed that the Ce_0.2Zr_0.8O₂ powders were solid solutions of pure tetragonal phase, whether as-prepared at 160 °C or calcined at 773–1273 K. By low-angle PXRD and transmission electron microscopy, the as-prepared Ce_0.2Zr_0.8O₂ showed a short-range ordered mesostructure probably as a result of the natural agglomeration of uniform nanoparticles upon hydrothermal treatment. The as-prepared powders had high surface areas (232–281 m² g⁻¹) and narrow pore size distributions (3.5–4.0 nm), according to the measurements of nitrogen adsorption. After calcining at 773 K, this mesostructure was retained to some degree with lower surface areas (66–75 m² g⁻¹) and larger pore sizes (5.1–7.2 nm). Determined by X-ray photoelectron spectroscopy, the numbers of oxygen vacancies (0.025–0.037) on the nanocrystalline surface was high for both as-prepared and calcined Ce_0.2Zr_0.8O₂. UV-vis absorption measurements showed that the band gap energy of the as-prepared Ce_0.2Zr_0.8O₂ nanocrystals was distinctly blue-shifted compared with the bulk value due to the quantum size effect. The catalytic tests demonstrated that the Ce_0.2Zr_0.8O₂ nanosized powders synthesized at 160 °C showed higher thermal stability in terms of surface area and phase composition, and higher catalytic activity for CO conversion than that synthesized at 140 °C. Among all the catalysts tested, the mesostructured one with the highest surface area and the largest pore volume displayed the highest oxygen storage capacity of 233 μmol CO g⁻¹ at 773 K, and the lowest 50% conversion temperature of 641 K.