Nanoparticles of ZrO₂:Er³⁺, Yb³⁺ fabricated by a soft template method combined with microwave heating under high pressures were reported for the first time. Nano ZrO₂:Er³⁺, Yb³⁺ in concentrations of 0.1–15 mol% have been fabricated in the presence of soft template agent diethylene glycol or polyethylene glycol in a microwave reactor at pressures up to 55 atm. The average size of the as-synthesized nanoparticles was found to be 5–13 nm. The upconversion luminescence of the ZrO₂:Er³⁺, Yb³⁺ was found in the red region of 630–710 nm and in the green region of 510–570 nm, with excitation by an infrared diode laser at the wavelengths of 830 and 940 nm, respectively. The change in content ratio between monoclinic and tetragonal phases when the annealing temperature increases from 600 to 1200 °C was investigated. The tetragonal phase content decreases and disappears for the samples annealed at 1200 °C. The increase in the content of the monoclinic phase is suggested to be a main reason for the increase in the upconversion luminescent intensity of nano ZrO₂:Er³⁺, Yb³⁺.