The nonlinear properties and electrical stability of ZnO varistors were improved with B2O3 additive using nano-coating method. The microstructural morphology and nonlinear electrical properties with increasing B2O3 contents were studied using SEM and CV measurements. The influence of B2O3 on grains and grain boundaries was investigated using impedance spectroscopy. The activation energy was calculated, and the dc stability tests were carried out. The results indicate that the B2O3 increases barrier height, enhances nonlinear characteristic, and decreases degradation rate coefficient. The effect of B2O3 on the nonlinear coefficient is derived from its low melting point. Finally, an explanation of oxygen absorption and desorption mechanism was proposed for the improvement of electrical properties.