To　understand　the　improved　stability　and　reduced　thermal　conductivity　of　20%　CeO2　stabilized　ZrO2　coatings　compared　to　pure　zirconia,　different　Ce　doped　ZrO2　systems　are　modeled.　The　Ce　insertion　in　ZrO2　lattice　elongates　the　lattice　parameters　and　the　elongation　is　proportional　to　the　Ce　doping　concentration.　Moreover,　the　cell　volume　linearly　increases　with　the　Ce　doping　level.　X-ray　diffraction　analysis　confirmed　the　Zr0.84Ce0.16O2　phase,　describing　the　substitutional　Ce　doped　at　Zr　sites.　Ce　doping　modified　the　electronic　band　structure　of　ZrO2　without　creating　any　isolated　states　in　the　band　gap.　The　Ce4Zr12O32　modeled　system　with　Ce　doping　concentration　of　8.33%　provided　the　stable　phonon　density　of　states　curves　compared　to　the　pure　and　doped　systems.　Ce　doping　reduced　the　thermal　conductivity　of　ZrO2.　Increasing　Ce　doping　level　further　reduced　the　thermal　conductivity　reaching　the　maximum　reduction　at　8.33%　doping　concentration.　Further　increase　in　the　Ce　level　has　no　effective　reduction　in　the　thermal　conductivity　values.　The　reduced　thermal　conductivity　is　attributed　to　the　enhanced　phonon　scattering　due　to　the　substitutional　Ce4+　dopant　and　optimal　doping　concentration.　The　experimental　observation　could　be　satisfactorily　explained　by　the　calculations　results.