Monodisperse indium oxide (In2O3) nanoparticles (NPs) with the average diameter of 11 nm were prepared by a solvothermal method. The In2O3 NPs were characterized by X-ray diffraction, Raman and transmission electron microscopy. The intrinsic nature of ferromagnetism in In2O3 NPs has been established with the experimental observation of magnetic hysteresis loop. Photoluminescence and UV-visible studies were employed to evidence the presence of oxygen vacancies and revealed that the oxygen vacancies contribute to the ferromagnetism. The origin of ferromagnetism in In2O3 NPs may be due to exchange interactions among localized electron spin moments resulting from oxygen vacancies. (C) 2014 Elsevier B.V. All rights reserved.