ITO (In0.95Sn0.05)2O3 and Ni doped ITO (In0.90Sn0.05Ni0.05)2O3 nanoparticles (NPs) were synthesized by solid state reaction method and subjected to study their structural, optical and magnetic properties. The NPs had a size distribution in the range of 40 nm and were identified as the bcc cubic In2O3 by X-ray diffraction (XRD). Optical properties of the samples were studies using UV-Vis-NIR spectrophotometer. Magnetic measurements were carried out at room temperature and at 100 K using vibrating sample magnetometer and found that the ITO nanoparticles were ferromagnetic in nature at room temperature. The strength of the magnetization decreased in ITO nanoparticles when the magnetic measurements carried out at 100 K. © 2016 Author(s).