Nickel ferrite (NiFe₂O₄) nanostructures have been synthesized by sol–gel method using glycolic acid as a chelating agent. Glycolic acid acts as a fuel, which decomposes the metal complexes at low temperature and yields impurity-free NiFe₂O₄ nanocrystalline structures. NiFe₂O₄ nanostructures, derived from thermal decomposition of the gel precursor, were characterized by X-ray diffraction (XRD), Fourier transform infrared (FTIR), field emission scanning electron micrographs (FESEM) and UV–vis absorption spectroscopy. The XRD results show that the nanocrystal contains single phase spinel structure with (Fd3m space group). The average particle size of nanostructured NiFe₂O₄ crystallites was calculated and found to be 27±2nm, which is in good agreement with the particle size calculated through FESEM micrographs. The energy band gap of the synthesized NiFe₂O₄ nanocrystalline structure was calculated to be ∼5eV. The optical studies show a direct allowed transition in NiFe₂O₄ nanostructures.