Metal coated ceramic nanopowders have a considerable potential for many fields of applications. Here, electroless coating of pure nickel onto yttria-stabilized zirconia nanoparticles is studied. We introduce a single step method to activate ceramic nanoparticles surface to reduce complexities of electroless coating on ceramic nanoparticles by conventional double step pre-treatments. X-ray diffraction and electron diffraction patterns beside transmission electron microscopy images are used to analyze the coated nanoparticles. We observe that palladium hydroxide acts as a catalyst for electroless nickel reaction like palladium and the ceramic nanopowders surface is effectively activated for electroless reaction by simpler single step activation methods. Atomic absorption spectroscopy results show that the performance of electroless reaction is not enhanced by increase in catalyst amount. Also, relative changes in amount of deposited nickel are investigated via magnetization curves of the coated particles. The vibrating sample magnetometery results demonstrate the magnetic behavior of the processed particles can be modified by deposited nickel amount.