Ceramic is the dielectric material used in the manufacture of ceramic capacitors. Dielectrics are the insulating material between the plates of capacitors. This material is chosen for its ability to permit electrostatic attraction and repulsion to take place across it. Ceramic is an excellent dielectric material because it is a poor conductor of electricity while being an effective supporter of electrostatic fields.

Ceramic capacitors are manufactured using a tape casting process wherein thin layers of conductive electrodes are separated by a dielectric layer, and a kind of multi-layer “sandwich” is formed to create a ceramic capacitor with a very large surface area in a very compact size. Recently, the combination of nickel electrodes and the ability to cast very thin layers has allowed the capacitance range of ceramic capacitors to exceed more than 100μF in an 1812 package, using X5R dielectric material. With the ability to stack hundreds of layers to form a single high-density, high-capacitance multilayer ceramic capacitor, new application opportunities, that were previously the sole domain of tantalum capacitors, are now available for ceramic capacitors. One of the driving forces for the increased capacitance values in ceramic capacitors was the tantalum shortage of 2000.

Prior to the use of nickel electrode systems, Palladium (Pd) and Silver (Ag) were the most common electrode materials. This precious metal became cost prohibitive when making very high-capacitance, high-layer count ceramic capacitors. Palladium and silver are still widely used for ceramic capacitors with lower capacitance values.

There are now a number of ceramic materials and compositions that are used in ceramic capacitors. These include ceramic NPO (COG), ceramic X7R, ceramic X5R, and ceramic Y5V.