Samples of nanocrystalline Cu doped ZnO have been prepared and characterised by several techniques including chemical analysis, X-ray powder diffraction and X-Ray absorption spectra (EXAFS). The particle sizes are typically less than 100 Å on the largest diameter. The diffraction results show that lightly doped samples, less than 10 mole per cent Cu, are single phase with the ZnO crystal structure. The EXAFS results indicate that although the Zn2+ions occupy normal cation sites the Cu2+ions are in highly disordered sites, suggesting that there is possible surface aggregation. Gas sensing experiments show a good response to low ppm concentrations of toluene vapour.