The microstructure in 2.9 mol% Y₂O₃-stabilized tetragonal zirconia polycrystal (Y-TZP) sintered at 1100°-1650°C was examined to clarify the role of Y³⁺ ions on the cubic-formation and grain growth processes. The cubic phase in Y-TZP stared to appear at 1300°C and the fraction of the cubic phase increased with the increasing sintering temperature. Scanning transmission electron microscopy and nanoprobe X-ray energy dispersive spectroscopy (EDS) measurements revealed that the Y³⁺ ion distribution in the grain interiors in Y-TZP was nearly homogeneous up to 1300°C and cubic phase regions in the grain interiors were formed clearly over 1300°C. The cubic phase region in the grain interior was extended as the sintering temperature increased. High-resolution electron microscopy and nanoprobe EDS measurements revealed that no amorphous layer existed along the grain-boundary faces in Y-TZP, and Y³⁺ ions segregated at their grain boundaries over a width of ~10 nm. The segregation peak of Y³⁺ ions was clearly seen at 1300°C, and above this temperature, Y³⁺ ions segregated at the grain boundaries not only between tetragonal grains but also between tetragonal and cubic grains. These results show that cubic phase regions started to be transformed from the grain boundaries and/or the triple junctions in which Y³⁺ ions segregated. The cubic-formation mechanism in Y-TZP can be reasonably explained from the viewpoint of the Grain Boundary Segregation-Induced Phase Transformation model, and the grain-growth behavior is probably controlled by the solute drag effect of Y³⁺ ions segregating along the grain boundary.