Optical absorption and resonant Raman techniques have been used to study the Ce3+<->Ce4+ conversion in cerium-doped yttria-stabilized zirconia single crystals (YSZ). The reduced material presents an intense orange coloration associated with a broad absorption band at 460 nm that we assign to a 4f-->5d transition. Its experimental oscillator strength is approximate to 1x10(-2). The Raman spectra consist of the lattice phonon bands at 600 cm(-1) and below together with an intense electronic Raman peak at 2086 cm(-1). The anomalous intensity of this peak is due to a resonance effect by the excitation in the 4f-->5d transition. The peak is associated with the F-2(7/2)-->F-2(5/2) electronic transition within the 4f(1) configuration of Ce3+. Heating in air at 1000 degrees C produces a complete discoloration of the sample. The effect of the oxidation can be fully reversed by reducing the sample at the same temperature. Optical spectroscopy has been used to determine the kinetics of the oxide-reduction process. Isothermal annealing in the temperature range 750-950 degrees C were performed in both oxidizing and reducing atmospheres. The results indicate that the oxidation process is diffusion-limited with an activation energy of approximate to 1.7 eV. For the reduction two alternative limiting processes are proposed : electron diffusion and ionization reaction.