Nanocrystalline zirconia-8-mol% yttria (yttria-stabilized zirconia (YSZ): ZrO2-8-m% Y2O3) fibers have been prepared from aqueous poly vinyl alcohol (PVA)-zirconium oxy nitrate solution and jute (plant fiber). Soluble Zr and Y ions in PVA solution formed a uniform coating on the surface of jute once it dried completely. Slow hydrolysis of zirconium ion with ammonium hydroxide deposited zirconium hydroxide on the jute surface. Decomposition of the dried zirconium hydroxide-coated jute at high temperature (1200 degrees C/2 h) resulted in the formation of single-phase, nanocrystalline cubic-YSZ with the corresponding average X-ray crystallite size 30-35 nm. Heat-treated fibers have been characterized by X-ray diffraction and scanning electron microscopy. We also prepared polymer composites by incorporating chopped, ground YSZ fibers into epoxy matrix and investigated polymer/fiber interface by transmission electron microscopy analysis.