Cobalt aluminate (CoAl2O4) nanoparticles were synthesized using a precursor method with the aid of ultrasound irradiation under various preparation parameters. The effects of the preparation parameters, such as the sonochemical reaction time and temperature, precipitation agents, calcination temperature and time on the formation of CoAl2O4 were investigated. The precursor on heating yields nanosized CoAl2O4 particles and both these nanoparticles and the precursor were characterized by means of X-ray diffraction (XRD), scanning electron microscopy (SEM), transmission electron microscopy (TEM) and atomic force microscopy (AFM). The use of ultrasound irradiation during the homogeneous precipitation of the precursor reduces the duration of the precipitation reaction. The mechanism of the formation of cobalt aluminate was investigated by means of Fourier transformation infrared spectroscopy (FT-IR) and EDX (energy dispersive X-ray). The thermal decomposition process and kinetics of the precursor of nanosized CoAl2O4 were investigated by means of differential scanning calorimetry (DSC) and thermogravimetry (TG). The apparent activation energy (E) and the pre-exponential constant (A) were 304.26 kJ/mol and 6.441 × 1014 s−1, respectively. Specific surface area was investigated by means of Brunauer Emmett Teller (BET) surface area measurements.