Tb 3+ doped Y 2 O 3 nanoparticles of 4–10nm size were synthesized from nitrate precursors by the urea hydrolysis method in ethylene glycol medium at a low temperature of 140°C. Characteristic green emission of Tb 3+ corresponding to 5 D 4 → 7 F J is observed to be very strong, which is further enhanced with heat treatment temperature. Characteristic blue color emission of Ce 3+ ion originating from 5d→ 2 F 7/2 (424nm) and 2 F 5/2 (486nm) transitions are found to be very strong in as-synthesized Ce 0.02 Tb 0.06 Y 1.92 O 3 nanoparticles. However, its luminescence intensity decreases with increase in heating temperature or increase in the particle size/crystallinity, whereas a weak emission peak of Tb 3+ ion at 545nm is witnessed. The polycrystalline nature of the as-prepared sample changed to highly crystalline state when heated at an elevated temperature (1200°C).