Efficient hydrogenation of levulinic acid (LA) into γ-valerolactone (GVL) in water using highly dispersed Ni– SnIJx)/AlOH (x = Ni/Sn ratio) was studied. Increasing the Sn amount in the Ni–Sn alloy up to 2.14 mmol g−1 enhanced the yield of GVL, which slightly decreased when the Sn content was nearly 4 mmol g−1 (feeding Ni/Sn = 1.0). A stoichiometric amount of GVL (>99%) was achieved by using Ni–SnIJx)/AlOH (x = 3.0 and 1.4) at 393 K for 120 min in H2O. H2-treated Ni–SnIJ1.4)/AlOH consisting of Ni3Sn2 alloy species showed high selectivity towards GVL (>99% yield). The Ni–SnIJ1.4)/AlOH catalyst was reusable for at least six consecutive runs without any significant loss of activity and selectivity.