This research aims to enhance the thermal stability of CdS nano-particles by a hydrothermally-formed glassy encapsulation structure of SiO2-CeO2. The crystalline phase, thermal effect and microstructure of the encapsulated CdS nanoparticles were investigated by the XRD, DSC-TG and TEM analysis. The results showed that most of the CdS nanoparticles had been encapsulated in the glassy phase of SiO2-CeO2 by a hydrothermal treatment at 200°C. This structure was stable up to more than 900°C, and it was destructed by the crystallization of crystalline CeO2 and SiO2 at a higher temperature. Protected by the glassy phase, the encapsulted CdS nanoparticles was thermally stable up to more than 900°C, which was gradually oxidized and sublimated at the temperature range of 1000-1200°C.