This paper reports the preparation of yttrium oxide (Y2O3) doped with various concentrations of Er3+ using high temperature synthesis method. Photoluminescence (PL) emission spectra of the samples were recorded at an excitation of 980 nm laser source. Two prominent peaks centered at 484 nm and 574 nm were found and attributed to the 2P3/2®4I11/2 and 4S3/2®4I15/2, respectively. The sample with 2.5 mol% of Er3+ provided the optimum intensity in emission spectra. The sample with optimum PL emission was investigated for its thermoluminescence (TL) glow curve exhibited the second order kinetics. The peak TL intensity was found around 236 °C, i.e., towards high temperature which supports the fact of formation of deeper traps. Therefore, the material taken may be regarded as a good candidate for light emitting diode (LED) applications.