Catalytic oxidative cracking of propane has been investigated over nanosized gold supported Ce0.5Zr0.5O2 catalysts. Gold supported catalysts offered high propane conversions and selectivity to olefins than Pt supported catalysts under the same reaction conditions. Ce0.5Zr0.5O2 showed is slightly active, but enhancement in the catalytic activity was observed when the catalyst deposited with 0.2 wt% gold. Further improvement in catalytic activity was observed with gold supported sulfated Ce0.5Zr0.5O2. Time on stream analysis revealed that gold supported sulfated Ce0.5Zr0.5O2 is stable even after 48 h of reaction and resistant to the coke formation. Increase in Bronsted and Lewis acidity of the catalyst sample was observed with incorporation of sulfate ions and gold metal. TEM and H-2-TPR results indicated that gold supported on sulfated Ce0.5Zr0.5O2 catalyst possessed homogeneous dispersion of nanosized gold particles and easily reducible metal-sulfate interactive species, which are majorly responsible for high activity and stability of this catalyst.