Lutetium oxide nanocrystals codoped with Tm3+ and Yb3+ were synthesized by the co-precipitation method. The obtained samples were characterized by X-ray diffraction (XRD),field emission scanning electron microscope (FE-SEM) and upconversion spectra measurements. Effect of the Tm3+ molar concentration and calcination temperature on the structure and upconversion luminescent properties of the nanocrystals have been investigated. The XRD results show that all the samples can be readily indexed to pure cubic phase of Lu2O3 and indicates good crystallinity. The experimental results show that concentration quenching occurs when the doping mole fraction of Tm3+ is above 0.2%. Blue,red and near infrared emissions from the prepared samples have been observed at 980 nm laser excitation. With the increase of the calcination temperature,the grain sizes and upconversion emission intensity of nanocrystals increase. Power-dependent investigation reveals that the blue(490 nm) and red(653 nm) upconversion fluorescence is three-photon upconversion process. The near infrared(811 nm) upconversion fluorescence is a two-photon upconversion process.