The largest value of saturation magnetization is found for undoped t-ZrO2 and it decreases as Mn content increases. The experimental results are explained in terms of coupling constant 'J' calculated using density functional theory (DFT). Oxygen-vacancy-mediated Zr-Zr ferromagnetic interaction (J = 1.07 kJ/mol) is found to be responsible for RTFM in undoped t-ZrO2 nano structures. However, Mn doping induces antiferromagnetic interaction (J = -0.55 kJ/mol) between Zr-Mn mediated by oxygen vacancies that essentially reduce ferromagnetism at (5 at.%) doping and finally leads to the paramagnetic nature at 10 at.% of Mn doping in ZrO2 matrix. (C) 2015 Elsevier B.V. All rights reserved.