The ZrO2-13 mol% MgO ceramic was investigated by using transmission electron microscopy (TEM) and X-ray diffraction after partial sub-eutectoid decomposition, and after high-temperature compression up to 10% at 900 degreesC. The sub-eutectoid decomposition led to the formation of ZrO2 tetragonal precipitates. The high-temperature deformation enhanced the transformation of the cubic ZrO2 (c-ZrO2) matrix to tetragonal ZrO2 (t-ZrO2), while existing tetragonal precipitates and part of the matrix were Partially transformed to monoclinic ZrO2 (m-ZrO2). Numerous deformation bands composed of martensite plates were observed in the matrix. (C) 2003 Elsevier Science B.V. All rights reserved.