Undoped SnO2 and erbium-doped SnO2 powders were successfully prepared by precipitation method. The effect of the heat treatment and doping contents on the structure of tin oxide and optical properties was also studied. The XRD data and Raman spectra indicate that the SnO2 crystals have formed after being heat-treated at 400°C and the average size of grains is about 8 nm for doping content of 1 mol%. An increase of doping concentration has controlled the growth of nanocrystals. The principle of the visible and infrared emissions of SnO2 and SnO2:Er is also discussed. All photoluminescence study shows that the Er3+ ions can be located in SnO2 nanocrystals and that there is energy transfer from defect levels of SnO2 nanoparticles to neighboring Er3+ ions of crystals.