The dispersion of CeO 2 nanoparticles resulted in a decrease of the oxidation rate of an ultrafine-grained Ni 2 Al 3 at 1000°C. The reason is explained as follows. During oxidation many Ce ions are released from the CeO 2 nanoparticles that are enveloped by the inward growing α-Al 2 O 3 from the scale/metal interface due to an increased solubility. The Ce ions transport outward along grain boundaries of the scale, retarding the diffusion of Al ions for the thickening of the outer θ-Al 2 O 3 . This explanation is consistent with an observation that many CeO 2 nano-precipitates appeared mainly in the near-surface zone of the formed alumina scale.