THE REDUCTION of ortho and para nitrophenols into the .........corresponding aminophenols has been proceeded via a new efficient catalytic reduction method. Hydrazine hydrate in the presence of nickel exchanged zeolite was used in the preparation of nickel nanocatalyst in zeolite surfaces. Zeolite-Y prepared from Egyptian kaolin has been used. At low temperature hydrazine hydrate molecules first decompose to give hydrogen atoms. Hydrogen atoms reduce the nickel ions exchanged inside the zeolite cages. This allows the formation of nickel clusters in the nanoscale size. Further decomposition of the hydrazine hydrate on the nickel atom surfaces yields nascent hydrogen atoms that efficiently reduce the nitro groups. Many techniques such as XRD, IR, TEM, UV-Visible absorption spectroscopy, and atomic absorption measurements have been used. XRD analysis confirms that zeolite Y retained its framework after nickel exchange processes. The atomic absorption measurements were used to determine the amount of nickel ions exchanged in zeolite. TEM shows the formation of nano nickel atoms inside the zeolite cages. IR analysis confirms the appearance of the characteristic peaks of only ortho or para aminophenols. UV-Visible absorption measurements have been used to follow up the disappearance of the nitro compounds as well as the estimation of the conversion percentage. Catalyst recovery and factors affecting the reduction reaction such as phenol concentration, pH, catalyst loading and temperature have been studied. The obtained data and kinetic results indicate that at a given experimental conditions, the conversion percentage reaches 100% within few minutes. Comparing the results to the previously published studies, it can be concluded that this method is more economic, faster and more efficient.