We report here cetyl alcohol-promoted synthesis of spherical CuCr₂O₄ spinel nanoparticles with almost uniform morphology, prepared hydrothermally. Detailed characterization of the material was carried out by XRD, XPS, ICP-AES, SEM, TEM, and TGA. XRD revealed the exclusive formation of the CuCr₂O₄ spinel phase and TEM showed the formation of a 20–40 nm particle size. The catalyst was highly active for selective oxidation of benzene to phenol with H₂O₂. The influence of reaction parameters was investigated in detail. The catalyst was found to be selective for hydroxylation of other aromatic alkanes as well. The reusability of the catalyst was tested by conducting the same experiments with the spent catalyst and it was found that the catalyst does not show any significant activity loss even after 5 reuses. The benzene conversion of 67% with 94% phenol selectivity was achieved at 75 °C temperature.