Electrical and dielectric properties, and their correlations were discussed in the nanostructured Ce0.8 Dy0.2 O2-δ materials with average grain sizes of 15, 35, and 58 nm using the dielectric functions such as dielectric permittivity (ε′), loss tangent (tan δ), and electric modulus (M″). The ionic transport mechanism varies with the grain size of the materials such that the material with an average grain size of 35 nm exhibited a higher value of ionic conductivity above 440°C (with σ=8.96× 10-4 S cm-1 at 550°C), whereas the material with an average grain size of 15 nm shows higher value conductivity at lower temperatures. The oxygen vacancy in the material decreases with the decrease in grain size. The migration energy of oxygen ions also decreases with the decrease in grain size of the nanostructured Ce0.8 Dy 0.2 O2-δ material. The material with an average grain size of 35 nm shows a very low value association energy (i.e., 0.05 eV) compared to the others. At temperatures below 420°C, the local motion of oxygen vacancies around Dy+3 controls the conductivity of all the materials, and at higher temperatures, the conductivity in the materials with a larger grain size is mainly due to the long-range motion of vacancies. © 2010 The Electrochemical Society.