CaCu3Ti4O12 (CCTO) ceramics sintered in air at 1115 degrees C for 3 and 24 h have been heat treated in N-2 at 1000 degrees C. Surface layers develop on the outer regions of the ceramics, and a combination of X-ray diffraction and analytical electron microscopy has been used to establish the phase content of the layers. A model to explain the formation of the surface layers is proposed based on decomposition of CCTO into a mixture of CaTiO3, TiO2, and Cu2O. The role of limited decomposition in the development of electrically inhomogeneous CCTO ceramics prepared at elevated temperatures in air is discussed.