The increasing energy consumption has made heavy oil more and more important in world energy system. However, the exploitation of heavy oil is still very challenging due to the high viscosity. Catalysts which can effectively promote heavy oil aquathermolysis to reduce the viscosity are in urgent demand. In this work, a Ni-based nanocatalyst for heavy oil aquathermolysis is fabricated through a sol-gel method. Characterizations with SEM, TEM, XRD, XPS, and VSM indicate that the fabricated nanocatalyst is magnetic Ni20(NiO)80 nanoparticles with diameter about 20 nm. The fabricated Ni20(NiO)80 catalyst shows excellent catalytic performance in promoting heavy oil aquathermolysis with the assistance of tetralin. The composition analyses of heavy oil after Ni20(NiO)80-catalyzed aquathermolysis demonstrate that the contents of light compositions in oil increase significantly and those of heavy compositions decrease significantly, resulting in up to 86.47% oil viscosity reduction. This will greatly improve the recoverability of heavy oil. Moreover, as the catalyst is magnetic, it could be easily separated from the reaction mixture, which will minimize the effect of aquathermolysis catalyst on the refining of the recovered oil.