Ni°-nanoparticles of 0–8 nm were prepared in situ by impregnation of Ni(CH3COO)2 into the nanopores of modified montmorillonite (Mt) followed by polyol reduction. The Mt was activated with HCl under controlled condition for generating desired pore sizes. The porous materials were characterized by XRD, TEM, SEM, UV–visible spectroscopy, FTIR and XPS analysis. N2 adsorption data revealed specific surface areas (BET) in the range of 296–548 m2/g, specific pore volumes of 0.4–0.6 cm3/g and pore diameters of 0–6.8 nm. XRD pattern of Ni°-nanoparticles revealed the formation of face centered cubic (fcc) lattice. These supported Nio-nanoparticles show efficient catalytic activity in transfer hydrogenation of acetophenone to 1-phenylethanol with about 98% conversion, having nearly 100% selectivity.Graphical abstractNi°-nanoparticles in the size range 0–8 nm have been synthesized into the nanopores of modified montmorillonite. These clay supported Ni°-nanoparticles showed efficient catalytic activity in transfer hydrogenation of acetophenone to 1-phenylethanol in presence of isopropanol as hydrogen donor and NaOH as base, yielding about 98% conversion and 100% selectivity.Research highlights► Generation of nanopores in montmorillonite. ► Synthesis of Ni°-nanoparticles into the nanoporous montmorillonite. ► Catalytic transfer hydrogenation reaction.