White light emitting nanocrystalline La2O3:Dy3+ phosphors with different concentration (0.5–2 at.%) were synthesized by simple precipitation method. X-ray diffraction (XRD) pattern indicates all the samples crystallizes in the hexagonal phase. Average crystallite sizes of the samples calculated from XRD data were found to be in the range of 20–55 nm. Transmission electron microscopy, selected area electron diffraction, energy dispersive analysis of X-ray and photoluminescence (PL) of the samples are also reported. Strong PL excitation peak due to charge transfer band was observed at 230 nm. Photoluminescence emission peaks observed at 486 and 575 nm were probably attributed to 4F9/2–6H15/2 and 4F9/2–6H13/2 of Dy3+ ions respectively. Optimum luminescence intensity is found at 1 at.% Dy3+ doped La2O3 sample. Further, Commission Internationale de l'é clairage (CIE, 1931) co-ordinates and correlated color temperature (CCT) of the doped sample were calculated to investigate the phosphors’ performance and technical applicability of the emitted light respectively. CCT of the 0.5 and 1 at.% samples is 5894 K (white light), within the range of vertical daylight, which makes the synthesised samples promising nanophosphor and may find application in simulating vertical daylight of the Sun.