The presence of stray capacitance in ZnO (Zinc Oxide) surge arresters causes hurdles in arrester operation and non-uniform voltage distribution along the arrester column, especially for High Voltage (HV) and Extra high voltage (EHV) applications. Since the magnitude of stray capacitance is directly proportional to the arrester height; the shortening of surge arresters is a preeminent method to enhance the arrester performance and voltage distribution. Particularly, this stray capacitive effect delays the arrester operation from in-action to action mode, especially against very fast surges. Moreover, the shortening of the arrester column improves the voltage distribution and hence the electric field varies between the stacks. Therefore, this research work focuses on the preparation of two new high gradient arrester materials doping with rare earth oxides. The microstructures of the newly developed materials are analyzed. It is found that there is a reduction of grain sizes and an increase of voltage gradients in the newly developed arrester materials. From this, the height requirement per unit is estimated and compared with the conventional ZnO arrester. Using these high gradient materials, the reduction of height and compactness of the arrester assembly may be achieved greatly. Thus, the developed ZnO surge arrester with high gradient materials enhances the arrester behavior with the attendant improvement of voltage distribution due to its reduced height and stray effect.