Spinodal decomposition in the TiO2SnO2 system produces TiO2 rich/SnO2 rich nano-wide lamellae. The high density of coherent interfaces is expected to reduce thermal conductivity of the ceramic without blocking electron transport. These semiconductors could therefore be candidates for environmental friendly oxide thermo-electrics. However, dense materials are difficult to obtain by conventional sintering from a mixture of TiO2 and SnO2 powders due to evaporation of tin oxide. The article presents a novel route to produce, by aqueous co-precipitation, Ti0.5Sn0.5O2 nanopowders as precursors for dense ceramics. The nanostructure developed by spinodal decomposition inside the grains of the as obtained dense Ti0.5Sn0.5O2 ceramic is shown to be comparable to that of porous Ti0.5Sn0.5O2 ceramic obtained by conventional method.