The optical properties of polyvinylpyrrolidone (PVP)-adsorbed and silica-coated Y2O3:Er,Yb nanoparticles produced by using PVP were studied for potential bio-applications of upconversion nanoparticles. We utilized PVP to better disperse Y2O3:Er,Yb nanoparticles in solution and to prepare silica-coated Y2O3:Er,Yb nanoparticles. The fluorescent intensity of PVP-adsorbed Y2O3:Er,Yb nanoparticles was 1.25 times higher than non-adsorbed Y2O3:Er,Yb nanoparticles, which was probably due to surface defects in Y2O3:Er,Yb nanoparticles being covered by the PVP. However, the fluorescent intensity of silica-coated Y2O3:Er,Yb nanoparticles decreased as silica layer thickness increased. This could be ascribed to the higher vibrational energy of PVP than that of the silica structure. Therefore, the optimum silica layer thickness is important in bio-applications to avoid deterioration of the optical properties of Y2O3:Er,Yb nanoparticles.