Metal-support interaction plays crucial role in heterogeneous catalysis, stabilizing the active metal species during catalysis. We report here the successful preparation of highly dispersed nickel nanoparticles supported ZrO 2 nanocrystals, which showed excellent performance toward catalytic reduction of nitroarenes to their corresponding amines, where metalsupport interaction plays the key role in enhancing the activity and stability of catalyst. The catalyst was synthesized by a single step hydrothermal method using CTAB (cetyltrimethyl ammonium bromide) as a structure-directing agent and PVP (Polyvinylpyrrolidone) as capping agent. Prepared catalyst was characterized by BET-surface area, Inductively coupled plasma atomic emission spectroscopy (ICP-AES), X-ray diffraction (XRD), Scanning electron microscopy (SEM), Transmission electron microscopy (TEM), Temperature programmed reduction (TPR), X-ray photoelectron spectroscopy (XPS), Fourier transform infra-red (FT-IR) spectroscopy, RAMAN spectroscopy, Thermogravimetric analysis (TGA-DTA), UV-vis spectroscopy and Extended X-ray absorption fine structure (EXAFS) analysis. Results obtained from XRD and TPR analysis of 4.9% Ni-ZrO 2 , support the presence of highly dispersed and subtle Ni (below 5 nm) nanoparticles supported on nanocrystalline ZrO 2 . Prepared 4.9 wt% Ni-ZrO 2 catalyst showed 100% conversion of p-nitrophenol with > 99% selectivity to p-aminophenol in aqueous medium at 60 8C, in presence of molecular H 2 (1.0 MPa). Superior activity of 4.9% Ni-ZrO 2 was due to presence of very small (below 5 nm), uniformly distributed, highly dispersed nickel nanoparticle having good metal-support interaction. Prepared 4.9% Ni-ZrO 2 catalyst was recycled up to eight successive runs without any significant loss in catalytic activity.