Nanopowder binary oxides consisting of Yttrium oxide (Y2O3) and silicon dioxide (SiO2) was prepared by the chemical co precipitation method. The effect of process variables lattice strain of Y2O3:SiO2 was studied using Cental Composite design. The results revealed that the significant factors affecting lattice strain were concentrations and the rate/speed of addition/mixing of precoursors, value and duration of annealing temperature. The optimal calculated parameters were found to be annealing temperature -300 0 C, drop rate-20d/min, concentration of precursors1-1 (w/v), concentration of precursors2-40 mmol/l, lattice strain Ԑ≈.000121 . The formation of Y2O3:SiO2 was confirmed by Fourier transform infrared (FTIR) spectroscopy and X-ray diffraction (XRD) studies. The strain values are calculated from W-H plot for annealed samples.