Y₂O₃:Ti³⁺, Eu³⁺ nanopowder was prepared by co-precipitation method in N2 and H2 atmosphere. Its XRD, excitation and emission spectra were measured, its morphology was observed. By analysis and comparison of spectra to Y₂O₃:Ti³⁺, Eu³⁺ with Y2 O3 :Ti3+, it was discovered that there exists energy transfer process from Ti3+ions to Eu3+ions, so Eu3+ions can be excited by ultraviolet or blue light and emit fluorescence peaks at about 610 nm via 5D0→7F2 transition channel. As a result the fluorescence in the red and orange light area is strengthened, therefore luminescence properties of the powder may be adjusted. The excitation spectrum of Y₂O₃:Ti³⁺, Eu³⁺ nanopowder extends from ultraviolet to blue-green region, and the strong fluorescence covers entire visible light region. It indicates that Y₂O₃:Ti³⁺, Eu³⁺ nanopowder is expected to be a new generation light conversion phosphor for white LED or mercury lamp.