The ability of cerium oxides to reversibly form mixed +3 and +4 valence oxides (CeO₂ and Ce₂O₃) leads to excellent oxygen storage capacity (OSC). Oxygen vacancy ordering may inhibit the reversible nature of the redox process and it has been reported that the addition of zirconia not only improves the life of the redox cycles but also lowers the reduction temperature. Therefore nanoscale ceria-zirconia particles have been widely used in automobile three-way catalysts to adjust the local oxygen environment in order to remove the unwanted gases from exhaust to reduce pollution. However, the complex nature of CeO₂-ZrO₂ solid solution leads to two types of heterogeneity especially at the nanometer level; chemical composition heterogeneity (x in Ce_xZr_1-xO₂) and crystallographic heterogeneity (cubic and/or tetragonal?). Consequently structural and chemical information at the nanometer level is critical to understand and optimize redox performance in these materials. Furthermore, the redox behavior of Ce is difficult to observe, as partially reduced cerium oxide is unstable at low temperatures and/or in high oxygen partial pressure. For this reason, we have undertaken a detailed in situ TEM study of the dynamic nanostructural and nanochemical changes that take place in ceria and ceria zirconia during redox cycles. Our preliminary observations provided evidence that in addition to structural heterogeneity (cubic and/or tetragonal), the complex nature of CeO₂-ZrO₂ solid solution also exhibits chemical heterogeneity (x in Ce_xZr_1-xO₂) at the nanometer level. Consequently atomic level structural and chemical information at the nanometer level is critical to understand and optimize redox performance in these materials. Furthermore, it is utmost important to correlate these inhomogeneities to the reduction behavior to understand the role of Zr. The fundamental understanding of such complex system will help us to determine the structure and composition that has the best redox properties. For this reason, we have undertaken a detailed in situ TEM study of the dynamic nanostructural and nanochemical changes that take place in ceria and ceria zirconia during redox cycles. High surface area samples of 50%CeO₂50%ZrO₂ samples were prepared by a spray freezing method. Samples were calcined at 500⁰C for 5h in air and then subjected to one redox cycle (reduced in H₂ at 1000⁰C for 2.75hs and subsequently re-oxidized in air). In situ nanocharacterization was performed in an environmental transmission electron microscopy (ETEM) Tecnai F20, operated at 200KV, equipped with a Gatan imaging filter (GIF) and annular dark-field detector. Ceria-zirconia powder was dispersed over Pt grids and loaded into the microscope in a Gatan heating holder. The samples were heated progressively up to reduction temperature in 1.5 Torr of dry H₂. Time and temperature resolved high resolution electron microscopy (HREM) images and energy-loss spectra were recorded to follow the structural and chemical changes during the reduction in H₂.  The chemical profile of individual nanocrystallites was obtained by using a sub-nanometer beam in STEM mode and recording electron energy-loss spectra (EELS) every 0.5 or 1nm (EELS line scans) from individual particles. The EELS line scans were processed to determine the variation in Ce/Zr ratio between different nanoscale grains and within individual nanoparticles. We have found that (a) nominally homogenous sample, as indicated by the X-ray powder diffraction, with 5-10 nm particle size, can be prepared by spray freezing method; (b) reactivity and particle size of samples calcined at 350^oC, does not alter during high temperature reduction cycles; (c) both inter granular and intra-granular heterogeneity is present in a nominally homogenous sample; (d) Ce oxidation state can be quantitatively determined from electron energy-loss spectroscopy by measuring white line ratio during reduction; (e) not all nanoparticles reduce at the same temperature and pressure conditions. We are currently working to determine relationship between compositional heterogeneity and reducibility of these particles and compare them with DFT calculations. The support from the National Science Foundation (NSF-CTS-0306688) and the use of TEM at the John M.Cowley Center for High Resolution Microscopy at Arizona State University are gratefully acknowledged.