Ceria-doped tetragonal zirconia polycrystals (Ce-TZP) exhibit exceptional physical and mechanical properties, making them promising for various applications. This research introduces a novel methodology using XRD analysis on the cut and fracture surfaces of Ce-TZP ceramics, to gain deeper insights into the toughening mechanisms. The sintered ceramic samples have been prepared from powders synthesized via the wet chemical coprecipitation technique with varying ceria content (12-18 mol %). The influence of ceria contents on the tetragonal phase stability of zirconia was investigated as well. X-ray diffraction (XRD), scanning electron microscopy (SEM) and Vickers indentation techniques were used to evaluate the tetragonal phase stability, microstructure, fracture toughness and hardness of the sintered samples, respectively. The results indicated that a stable tetragonal phase predominates at ceria content from 12-18 mol %, whereas below 12 mol %, the tetragonal phase undergoes transformation to the monoclinic phase upon cooling from the sintering temperature. Dense ceramics with high strength and fracture toughness were achieved for sintered zirconia containing 12-18 mol % ceria, with strengths ranging from 430 up to 560 MPa depending on ceria contents. Samples containing 12 mol % ceria, sintered at 1500 °C, exhibited a high toughness (KIC) of 22 MPa√m. XRD analysis on cut samples' surfaces, which represents the novelty of the present study, elucidates stress-induced transformation and/or domain reorientation as key toughening mechanisms in Ce-TZP zirconia ceramics.