In this study, the influence of different ZnO particle sizes and the oxygen annealing process on the microstructure, and electrical properties of ZnO-based varistors was investigated. ZnO-Bi2O3-Mn2O3 discs based varistors with different size of ZnO particles were prepared by conventional ceramic method. Then half of varistors discs were annealed in oxygen atmosphere at 700 °C. SEM, Raman spectroscopy, and current-voltage (I–V) measurement were used. The results showed a significant improvement in distribution and growth of grain sizes in nano-size samples compared to that of micro-size samples. The electrical properties including nonlinear coefficient and breakdown voltage improved to 49 and 2555 V in nano-size compared with 32.5 and 201V in micro-size.