Zinc oxide nanocrystals were synthesized by two precipitation methods successfully. The nanocrystals prepared via method I (zinc acetate dihydrate precipitation with KOH) were smaller in crystallite size (~20 nm) as compared to method II (zinc nitrate hexahydrate precipitation with N,N-dimethylformamide, ~33 nm). FTIR technique was used to study chemical bonding; SEM and EDS were used to study morphology and chemical compositions. Number of concentric rings corresponding to diffraction peaks was higher in SAED pattern for ZnO nanocrystals synthesized by method I than II. Variation in the energy band gap as a function of particle size was determined using absorption spectra from UV-vis-NIR spectrophotometer. Redshift was observed in the energy band gap of sample prepared via method II. Particle size and the structure of the nanocrystals were analysed by transmission electron microscope (TEM). From TEM study, it was found that the average particle size of method I nanocrystals was smaller compared to method II nanocrystals. Magnetic study was carried out using VSM. Ferromagnetism like contribution was observed for the sample prepared by method II.