Monoclinic zirconia (ZrO2) as a potential host for diluted magnetic semiconductors (DMS) was investigated using density functional theory (DFT). Our calculations assessed the feasibility of long-range magnetic order at room temperature for transition metal ions substituting Zr. The defect-related d states split into e(g) and t(2g) bands. The exchange mechanism was shown to have strong nearest-neighbour coupling for several dopants reaching up to 150 meV for Fe. However, there was little to no long-range coupling extending beyond nearest-neighbour coordination, resulting in a non-physically high-defect concentration necessary for room temperature ferromagnetism. (c) 2007 Elsevier B.V. All rights reserved.