A method to produce ZrO2 nano-particles is developed and the effect of particle size on the phase structure of ZrO2 is studied. The method is based on the hydrolysis of ZrOCl2 solution in the reverse micelles of a liquid-liquid two-phase system, in which AOT (sodium 2-ethylhexyl sulfosuccinite) and toluene are chosen as the surfactant and organic phase, respectively. The reverse micelles prevent the aggregation of primary particles, the nano-particle size increases as the AOT content decreases. The TEM,XRD and particle-size analysis results show that the occurrence of metastable tetragonal ZrO2 is attributed to the effect of the particle size other than the effect of the crystallite size. The ratio of t-phase to m-phase increases as the particle size decreases, and 28 nm is the critical size for t-phase to m-phase transformation.