The objectives of this study were the development of a synthesis technique for highly active nanosized ITO powder and the understanding of the reaction mechanisms of the ITO precursors. The precipitation and agglomeration phenomena in ITO and In_2O_3 precursors are very sensitive to reaction temperature, pH, and coexisting ion species. Excessive Cl- ion and Sn+4 ions had a negative effect an synthesizing highly active powders. However, with a relevant stabilizing treatment the shape and size of ITO and In_2O_3 precursors could be controlled and high density sintered products of ITO were obtained. By applying the reprecipitation process (or stabilization technique), highly active ITO and In_2O_3 powders were synthesized. Sintering these powders at 1500°C for 5 hours produced 97% dense ITO bodies.