We found that single grains as large as 40 μm in length of lead zirconate titanate (PZT) thin film could be fabricated by lateral crystallization from the seeds. The seeds were prepared on a Pt substrate in the form of crystallized PZT dots. The electrical characteristics of PZT thin films obtained by selectively nucleated lateral crystallization (SNLC) were found to be superior to those of polycrystalline PZT thin films. In this paper, we review the mechanism for SNLC. From investigation into the nucleation and grain-growth processes in PZT thin films, we devised a novel annealing method that is suitable for SNLC of PZT thin films. It was found that scanning-rapid thermal annealing is a very effective method for SNLC in terms of reducing the process time and preventing undesirable nucleation in regions outside of pre-determined nucleation sites.