The present invention is a method of producing a ceramic article. The method includes forming an intercalated or exfoliated solution of smectite clay and a polymer selected from polyvinyl alcohols, polyethylene oxides, polystyrene sulfonates, polyacrylamides, polymers of styrene, alkyl acrylates, alkyl methacrylates, olefins, acrylonitriles, polyurethanes and polyester ionomers. The solution is mixed with zirconia stabilized with at least one rare earth oxide element selected from Mg, Ca, Y, Sc and Ce to form a mixture. The mixture is molded into a green part. The green part is sintered to form the ceramic article.