Different amounts of dysprosium oxide were incorporated into barium titanate powders synthesized by hydrothermal method. Relations of substitution behaviors and lattice parameters with solid-solubility were studied. Furthermore, the influences of dysprosium oxide doping fraction on grain size and dielectric properties of barium titanate ceramic, including dielectric constant and breakdown electric field strength, were investigated via scanning electron microscope, X-ray diffraction and electric property tester. The results show that dysprosium oxide can restrain abnormal grain growth during sintering and that fine-grained and high density of barium titanate ceramic can result in excellent dielectric properties. As mass fraction of dysprosium oxide is 0.6%, the lattice parameters of grain increase to the maximum because of the lowest vacancy concentration. The electric property parameters are cited as following: dielectric constant (25 ℃) reaches 4100, the change in relative dielectric constant with temperature is -10% to 10% within the range of -15～100 ℃, breakdown electric field strength (alternating current) achieves 3.2 kV·mm-1, which can be used in manufacturing high voltage ceramic capacitors.