Present invention relates to a process for production of isomerization catalyst, containing a base of zirconia, a binder based on alumina and/or silica at-least one component of Group VI of the periodic table in the form of their oxyanions, a hydrogenation/dehydrogenation component loaded on the base, at least one metal selected from the group consisting of Pt, Pd, Sn, Re or mixtures thereof, and an peptization agent, wherein the peptizing agent is an organic acid and polymers, which improve the physicochemical properties of the isomerization catalyst for the production of C4-C12 paraffin's.