A new sol-gel processing method to prepare ZnO-based varistor powders, using inexpensive zinc acetate dihydrate, ethylene glycol, n-propyl alcohol and glycerol as starting materials, is presented. Compared to conventional oxide-mixing techniques, this method yields powders with a more homogeneous distribution of dopants; the sintering temperature could be lowered by about 200 K to 1000 o C and the grain size is much smaller which proves very helpful for achieving high breakdown strength. Microstructure and electrical characteristics of the sintered powders were investigated.