In this paper we report observation of highly efficient Pr3+ 4f–4f emission in ZrO2 (0.5 mol. % Pr3+) fine nanocrystals stabilized by Y2O3 (7 mol. % ). The nanocrystals were obtained via a hydrothermal microwave-driven process followed by heat treatment at 1200 °C. The samples excited by 266 or 297 nm light exhibit a remarkable sensitizing of Pr3+ photoluminescence. The chromaticity analysis indicates the usability of the studied material as a red luminescent phosphor.