The Cd2+-doped NaLuF4∶Yb, Er nanocrystals were synthesized by an improved high-temperature thermal decomposition method, and the effects of Cd2+ on crystal phase formation and luminous intensity were studied. The formation energy of β-NaLuF4∶Yb, Er at different doping concentration was calculated by CASTEP. The nanocrystals synthesized at the doping concentration of 6mol% have the strongest fluorescence intensity, which increase by 2.6 times compared to the undoped one. The average size is about 23 nm. Subsequently, the problem of easy agglomeration of crystals was solved by controlling the addition of suitable proportion and content of dispersants, and the up-conversion nanocrystals with high crystallinity and good dispersibility with average size of 18 nm were obtained. The coating of the silica shell layer reduces the toxic reaction caused by Cd2+ leakage, indicating that it exhibits low toxicity when the concentration is low, and meets the requirements of the application of upconversion nanocrystals in the field of medical materials.