Yttria partially stabilized zirconia (similar to 4.0 mol% Y2O3 ZrO2, 4YSZ) has been widely employed as thermal barrier coatings (TBCs) to protect the high temperature components of gas turbine engines. The phase stability problem existing in the conventional 4YSZ has limited it to application below 1200 degrees C. Here we report an excellent zirconia system co-doped with 16 mol% CeO2 and 4 mol% Gd2O3 (16Ce-4Gd) presenting nontransformable feature up to 1500 degrees C, in which no detrimental monoclinic (m) ZrO2 phase formed on partitioning. It also exhibits a high fracture toughness of similar to 46 J m(-2) and shows high sintering resistance. Besides, the thermal conductivity and thermal expansion coefficient of 16Ce-4Gd are more competent for TBCs applications as compared to the 4YSZ. The combination of properties suggests that the 16Ce-4Gd system could be of potential use as a thermal barrier coating at 1500 degrees C.