Partially stabilized zirconia (PSZ) exhibits excellent physical, mechanical, electrical, chemical, thermal, and bioactive properties. Therefore, it is frequently used as a material for thermal barrier coatings, refractories, oxygen-permeating membranes, dental and bone implants. In this study, magnesia-partially stabilized zirconia nanoparticles were successfully prepared from zirconium silicates and MgSO4 assisted with PEG-6000 via a facile templating method. The MgO concentration was varied from 1%–10% in wt% of ZrO2. Zirconium silicates were initially converted to Zr-precursor solution, exhibiting pH 3. Then, the appropriate amount of the Mg-precursor was mixed with the proper amount of the Zr-precursor solution. A 10%(w/v) PEG-6000 solution was added into the PSZ precursor solution at a ratio of the precursor-to-PEG volumes of about 15:1 under stirring and heating, resulting in a very fine white gel. The gel was filtered, dried, and then calcined at elevated temperatures of 600, 800, and 1000 °C. The characteristics of the final product were then evaluated. According to the experimental results, the MgO concentration influences the ZrO2 phase transformation at elevated calcination temperatures. In this study, the lower the MgO dopant concentration added into ZrO2, the more stable the t- ZrO2 phase in PSZ samples at high temperatures. However, the MgO presence is detected as periclase in all samples with a very low peak intensity at elevated calcination temperatures. The obtained PSZ samples consist of nanoparticles and high agglomeration, some of particles exhibit elongated and rod-like shapes. The PEG existence during the PSZ preparation has restrained particle interaction and aggregation of the as-synthesized PSZ samples, leading to PSZ nanoparticles evolution.