Nickel nanoparticles supported on a NiO-MgO solid solution are fabricated using the exsolution process. Upon reduction, the nickel nanoparticles are exsoluted from a Ni0.4Mg0.6O solid solution powder. From the results obtained from transition electron microscopy (TEM) and temperature programmed reduction (TPR) measurements, it is concluded that the size and dispersion state of the nickel nanoparticles strongly depend on the homogeneity of the parent solid solution. Sintering the parent solid solution powder at a high temperature results in a homogeneous solid solution, which leads to a decreased reducibility of the nickel ions and, consequently, well-distributed Ni nanoparticles are successfully obtained. The metallic nickel moves reversibly to and out of the parent solid solution in response to a specific atmospheric condition. The methane steam reforming over the as-synthesized nickel nanoparticles are evaluated and appreciable degradation (1000 h) of the catalytic activity is not found for the catalyst sample that is sintered at 1000 degrees C followed by subsequent reduction to 800 degrees C.