Zirconia supports were synthesized via a precipitation method, and the effects of crystalline structure and textural properties of ZrO2 on the methane combustion reaction were investigated using the Pd/ZrO2 catalysts. Upon increasing the digestion temperature, the crystalline structure of ZrO2 was transformed from the mixed phase (monoclinic and tetragonal) to the pure tetragonal phase, and these tetragonal ZrO2 supported Pd catalysts exhibited good hydrothermal stabilities. In addition, the BET surface areas of the tetragonal ZrO2 supports could also be tuned by varying the digestion time and calcination temperature, and the catalysts supported on ZrO2 having lower BET surface areas exhibited enhanced catalytic activities. Therefore, the Pd/ZrO2(85) catalyst, which had a tetragonal structure in addition to the smallest BET surface area, gave the optimal catalytic performance. This is likely due to larger PdO particles being formed on this ZrO2(85) support, thereby resulting in a highly reducible PdO species. Finally, variations in reducibility between the monoclinic and the tetragonal supported catalysts were clearly calculated by the density functional theory.