In this article, we report on the fabrication of 0.3-mu m average grain-sized transparent yttria ceramics using a modified two-step sintering approach. This process yielded full densification of the yttria ceramics with a drastically reduced grain growth. These transparent yttria ceramics exhibited a transparency equivalent to that of single crystals in the near-infrared spectral region. The microhardness and fracture toughness of the 0.3-mu m average grain-sized transparent yttria ceramics fabricated by a modified two-step sintering were found to exceed those of similar to 300-mu m average grain-sized transparent yttria ceramics fabricated by conventional sintering by 25 and 70%, respectively.