The YSZ-NiO ceramics for solid oxide fuel cells (SOFCs) anode have been investigated. A series of specimens were singly reduced in a hydrogenous atmosphere (Ar-5 vol% H2 mixture) at 600 °C under the pressure of 0.15 MPa or subjected to 'reduction in the mixture-oxidation in air' (redox) cycling at 600 °C. The YSZ-Ni cermets formed in both treatment conditions were then aged in 'water vapor in Ar-5 vol% H2 mixture' atmosphere at 600 °C under the pressure of 0.15 MPa. Additionally, the behaviour of the as-received material in this atmosphere was studied. It was revealed that small amount of water vapor in Ar-5 vol% H2 mixture (water vapor pressure below 0.03 MPa) does not affect the reduction of the nickel phase in the YSZ-NiO ceramics, but causes some changes in the YSZ-Ni cermet structure. In particular, nanopore growth in tiny Ni particles takes place. At higher concentration of water vapor in the mixture (water vapor pressure above 0.03-0.05 MPa), converse changes in the kinetics of reduction occur. The best physical and mechanical properties were revealed for the material treated by redox cycling after holding at 600 °C in water depleted gas mixture. The dual effect of water vapor on nickel-zirconia anode behaviour is discussed basing on scanning electron microscopy analysis data, material electrical conductivity, and strength.