In this work, we synthesized pure tetragonal phase LiYF4 microcrystals by a hydrothermal method. In the reaction, sodium ions acted as an intermedium species. The long axis of the quasi-octahedron crystals was about 5 to 20 micrometers. Strong UV 1I6 → 3H6 (~291 nm), 1I6 → 3F4 (~346 nm), and 1D2 → 3H6 (~362 nm) and blue emissions 1D2 → 3F4 (~450 nm) and 1G4 → 3H6 (~475 nm) could be observed in our samples. We could see blue luminescence from the microcrystals by our naked eyes in the daylight even if the pump power of the 980 nm laser diode was less than 10 mW. Obvious energy level splitting was also observed, which indicated that Tm3+ ions were embedded into the crystal lattice very well. The 1G4 energy level split into four subenergy levels owing to the effect of crystal field. The upconversion mechanisms were discussed in detail.