Nanopowders of phase pure TiO2 (rutile) have been synthesized by hydrothermal method using dilute nitric acid as a peptizer. The nanoparticles exhibited bimodal morphological features. The sintering behavior of these nanoparticles have been investigated and compared with the commercially obtained mixed phase (86% anatase+14% rutile) nanopowders of TiO2. The hydrothermally synthesized nanopowders were found to sinter to nearly 90% of the theoretical density at approximately 850°C and still maintain nanostructured grains. This is important for the application of these materials for gas sensors, disinfectants, and as photocatalysts. The nanopowders of TiO2 synthesized by hydrothermal method have superior physical and microstructural features compared with commercial nanopowders. It is possible to scale up the process with relative ease and at much lower capital cost.