Highly crystalline and monophasic nanoparticles of In2-xCoxO3 (0.05 <= x <= 0.15) were successfully synthesized by the solvothermal method through an oxalate precursor route. Collective evidence from X-ray diffraction and reflectance measurements suggest that the Co2+ is incorporated into the In2O3 lattice site. Effect of cobalt dopant on the growth and morphology of indium oxide was studied by transmission electron microscopy. It has been observed that particle size decreases from 23 to 9nm on increasing the Co concentration. High surface area has been obtained, with values ranging between 66 and 151m(2)/g, respectively. Values for the dielectric constant were around 40. All these solid solutions show paramagnetic behavior with weak antiferromagnetic interactions.