When working with chemical solution deposition techniques, one of the main issues for optimal performance of CeO2 buffer layers in coated conductors is the insufficient chemical stability of the CeO2 layer during YBa2Cu3O7 (YBCO) thermal processing. This work focusses on the morphology and nanostructure in thin CeO2 films prepared by means of a novel aqueous synthesis route and incorporated into a Ni–W/La2Zr2O7/CeO2/YBa2Cu3O7‐coated conductor. Optimization of precursor chemistry and thermal processing led to a reduction in barium cerate formation. In a new precursor design, iminodiacetic acid was used as a stabilizing ligand, which resulted in an improved morphology of the buffer layer. A shelf life of more than 6 months was established by using a metal‐to‐ligand ratio of 1 to 5. During thermal processing, a combination of a slow calcination ramp with a high sintering ramp, short sintering dwell time and a low oxygen partial pressure during the synthesis resulted in a root mean square roughness below 3 nm for AFM analysis, a [111] to [002] ratio of 1 to 90 in X‐ray diffraction and well‐defined patterns in reflection high‐energy electron diffraction (RHEED) analysis of the CeO2 surface. Trifluoroacetate‐YBCO was deposited on top of the CeO2 buffer layer. Cross‐section analysis with a focussed ion beam allowed us to correlate the morphology and nanostructure of the CeO2 buffer layer with the formation of BaCeO3 and the appearance of voids and secondary phases throughout the YBa2Cu3O7 layer.