A systematic study was carried out to determine the effects of composition and grain size on the structural, optical and magnetic properties of pure ZnO and vanadium-doped ZnO nanocrystalline powders and films in the 0.0 at.% V - 6 at.% V range. The powders and films were synthesized via a sol-gel approach, where ethanolamine was used to increase the viscosity of the precursor solutions and promote the adhesion of the films onto quartz substrates. Powder X-ray diffraction confirmed the formation of ZnO (host oxide) after annealing of the precursors in air. The average grain size in the thin films ranged from 11 nm to 23 nm when the samples were annealed in air for one hour between 450ºC and 550ºC. UV-vis and photoluminescence confirmed the formation of the host oxide. Also, the photoluminescence intensity was found to be strongly dependent on the amount vanadium. Furthermore, it was found that the vanadium concentration and the annealing temperature play an important role in the ferromagnetic behavior of the material.