Single-phase ZnO:Co2+ nanoparticles of mean size 2-8 nm were synthesized by a simple co-precipitation technique. X-ray diffraction analysis reveals that the Co-doped ZnO nanoparticles crystallize in wurtzite structure without any impurity phase. The wurtzite structure (lattice constants) of ZnO nanoparticles decrease slightly with increasing Co doping concentration. Optical absorption spectra show an increase in the band gap with increasing Co content and also give an evidence of the presence of Co2+ ions at tetrahedral sites of ZnO and substituted for the Zn site with no evidence of metallic Co. Initially these nanoparticles showed strong ferromagnetic behavior at room temperature, however at higher doping percentage of Co2+, the ferromagnetic behavior was suppressed, and antiferromagnetic nature was enhanced. The enhanced antiferromagnetic interaction between neighboring Co-Co ions suppressed the ferromagnetism at higher doping concentrations of Co2+. Photoluminescence intensity owing to the vacancies varies with the Co concentration because of the increment of oxygen vacancies. (c) 2010 Elsevier Inc. All rights reserved.