The structural, optical, magnetic and electrical properties of cerium oxide (CeO2) nanoparticles prepared by hydrothermal route are analyzed by subjecting them to characterization techniques such as Powder X-ray diffraction (PXRD), High resolution scanning electron microscope (HRSEM), High resolution transmission electron microscope (HRTEM), Energy Dispersive X-ray Analysis (EDAX), Fourier transform infra red spectroscopy (FTIR), Raman spectroscopy, Ultraviolet–Visible analysis, Vibrating sample magnetometer (VSM) analysis and Dielectric measurements. The PXRD, FTIR, Raman and EDAX analyses confirm the formation of CeO2 nanoparticles. The PXRD studies reveal that the cerium oxide nanoparticles have crystalline nature and have Face Centered Cubic structure. The average crystallite size, estimated using Scherrer formula, is 7 nm. The HRSEM and HRTEM images reveal that the CeO2 nanoparticles have spherical morphology with an average particle size of 23 nm. The optical band gap energy of the cerium oxide nanoparticles, calculated from UV–Vis studies, is 3.4 eV which could be due to the substantial concentration of Ce3+ ions in the ceria nanoparticles. The Ferromagnetic behavior of CeO2 at room temperature is implied from VSM studies. The Dielectric analysis divulge that the dielectric constant of cerium oxide nanoparticles decreases as the frequency and temperature increases. The electrical behaviour, activation energy and relaxation time of electrons of CeO2 nanoparticles are studied by plotting Nyquist plot, Arrhenius plot and Bode plot respectively.