The presented study investigated the effects of temperature (350–650 °C) and gas environment (pure Ar versus a H2O/H2 partial pressure ratio (PH2O/PH2) of 5) on the extent of sintering and oxidation of Al2O3-supported Ni0 nanoparticles (≈4 nm). We note that a PH2O/PH2 of 5 corresponds to a simulated CO conversion of 94% during methanation. Sintering and oxidation were studied using in situ magnetometry, while ex situ TEM analyses confirmed the particle sizes before and after the magnetometry-based experiments. It was found that increasing the temperature from 350 to 650 °C in Ar at atmospheric pressure causes a negligible change to the average size and degree of reduction (DOR) of the starting Ni0 nanoparticles. However, studying the same temperature window under hydrothermal conditions at 10 bar causes significant particle growth (≈9 nm) and the development of a bimodal distribution. Furthermore, the presence of steam decreases the DOR of Ni0 from 86.2% after initial activation to 22.2% due to oxidation. In summary, this study reports on the expected sintering and oxidation of Ni-based catalysts under high CO conversion conditions at elevated temperatures during methanation. Importantly, we were able to demonstrate how magnetometry-based analyses can provide similar size information (and changes thereof) as those observed with TEM but with the added advantage that this information can be obtained in situ.