We studied the catalytic hydrogenation of CO2 to methane using nickel-niobia composite catalysts. Catalysts containing 10–70 wt% Ni were synthesized by wet impregnation and tested for CO2 hydrogenation in a flow reactor. 40 wt% was found to be the optimum Ni loading, which resulted in CO2 conversion of 81% at 325 °C. We also calcined the Nb2O5 support at different temperatures to study the influence of calcination temperature on the catalytic performance. 40 wt% Ni loaded on Nb2O5, which was calcined at 700 °C gave higher methanation activity (91% conversion of CO2). Time on stream study for 50 h showed a stable activity and selectivity; thus confirming the scope for practical application.