Ultrasmall monodisperse 2.3 nm CeO2 nanoparticles have been synthesized by simple ammonia precipitation of cerium nitrate in a mixed glycol-water solvent and phase transferred into apolar solvents. Cerium oxide crystal surfaces were passivated with oleic acid (OA) by reflux under ambient pressure conditions. OA molecules were chemisorbed on the ceria nanopartide surfaces. Preferential growth of the {100} planes has been observed, ascribed to restricted growth of {111} faces due to adsorbed OA. The surfacted CeO2 nanopartides were dispersed into a stable, colloidal suspension of fine particles in hydrocarbon solvents. The CeO2 nanocrystals were characterized by X-ray diffraction, Fourier transform infrared spectra, and Raman spectral methods. Transmission electron microscopic images and photon scattering studies proved that the colloidal particles in hydrocarbon solvent were indeed monocrystalline with one crystallite per particle, monodispersed with a narrow size distribution.