(001)-oriented and in-plane aligned yttria-stabilized zirconia (YSZ) thin films were synthesized on Ni-Cr alloy substrates by ion beam assisted deposition. It was found that it is not the (111) axial channel but the {110} plane channel that will always follow the direction of the bombarding ion beam and will result in the in-plane aligned structure of the YSZ films. At 55 degrees incident angle, the bombarding ion beam is in the {110} plane channel and the (111) axial channel simultaneously; this produces the optimal biaxial alignment of YSZ films. On YSZ single crystalline substrates or textured YSZ layers, growth of YSZ films will not be controlled by the bombarding ion beam; rather, but the films continue to grow along the lattice orientation of the substrate. The formation of the biaxial alignment is an evolutionally selected process by ion beam selective bombardment. YSZ grains of (001) orientation are resputtered less than other oriented grains under ion beam bombardment, which causes the (001) orientation to emerge from initial random orientations evolutionally. About a 1000 Angstrom-M20 thickness is needed to develop the alignment. The roughness of the substrate has no obvious influence on the alignment within several hundred ii. Increasing the substrate temperature tends to reduce the (001) orientation and to promote the (111) orientation along the substrate normal. Postannealing of the YSZ films fabricated at ambient temperature can improve the crystalline structure.