Display omitted •In-Zr/SAPO-34 catalysts were used for direct CO2 hydrogenation to lower olefins.•In-Zr composite oxides were prepared with the introduction of different Zr content.•A selectivity for C2=–C4= was up to 80% in hydrocarbons with 2% CH4 and 64% CO.•The addition of a certain amount of Zr can markedly enhance catalytic performance. Direct production of lower olefins (C2=−C4=: ethylene, propylene and butylene), basic carbon-based building blocks, from carbon dioxide (CO2) hydrogenation is highly attractive, although the selectivity towards olefins has been too low. Here we present a series of bifunctional catalysts contained indium-zirconium composite oxides with different In:Zr atomic ratios and SAPO-34 zeolite, which can achieve a selectivity for C2=–C4= as high as 65–80% and that for C2–C4 of 96% with only about 2.5% methane among the hydrocarbon products at CO2 conversion of 15–27%. The selectivity of CO via the reverse water gas shift reaction is lower than 70%. The product distribution is completely different from that obtained via CO2-based Fischer-Tropsch synthesis and deviates greatly from the classical Anderson-Schulz-Flory distribution. The zirconium component plays a critical role in determining the physicochemical properties and catalytic performance of bifunctional catalysts. Catalyst characterization and density functional theory calculations demonstrate that the incorporation of a certain amount of zirconium can create more oxygen vacancy sites, stabilize the intermediates in CO2 hydrogenation and prevent the sintering of the active nanoparticles, thus leading to significantly enhanced catalytic activity, selectivity of hydrocarbons and stability for direct CO2 hydrogenation to lower olefins at the relatively high reaction temperature of 380 °C.