Rare earth Yttrium (Y3+) substituted strontium hexaferrite (SrFe12-xYxO19) with X = (0.25–1.0), is synthesized using an economical and chemical-based sol–gel technique. The reflected planes in the XRD patterns justify that samples possessed hexagonal symmetry (P63/mmc space group). Crystallite size and strain calculations for SrFe12-xYxO19 samples were performed with a W-H plot. Lattice constants change minutely but regularly with Y3+ composition. The morphological structure of the sample SrFe12O19, SrFe11.50Y0.50O19, and SrFe11Y1O19 have been visualized from SEM micrographs, which reveal hexagonal crystal symmetry, possessing agglomeration with an average particle size of 49.84 nm, 73 nm, and 39.66 nm respectively. TEM, HRTEM, and SAED have been performed for confirming the lattice fringe distance, the grain size of nanoparticles (NPs), and diffraction planes. Grain size is 44.15 nm and 37.27 nm for X = 0.00 and X = 1.0 composition of Y3+. Raman spectral pattern exhibited that all the peak of the synthesized sample is indexed to Raman vibration modes and strontium hexaferrite (SHF) structure. FTIR analysis supports the stretching of metal-oxygen bonding and helps to find the force constant, bond length, and functional group of samples. The highest luminescent peak is observed at 481 nm, using the PL spectrum. Using UV-Visible spectroscopy direct band gap (Eg) of the synthesized sample was evaluated and is found to decrease from 2.3 eV-1.93 eV with Y3+ concentration. With an increase in the composition of non-magnetic ions of Y3+, Ms and Mr parameters decrease systematically. In contrast, the coercivity value increases drastically from 5983–6595 Oe and is one of the novel works of this report. The occupancy of Y3+ ions in SrFe12-xYxO19 lattice obstructs electrical leakage to generate remnant polarization (Pr) and coercive polarization (Pc) of values 25.45 μC cm−2 and 2.91 kV cm−1 respectively. Moreover, cytotoxicity assay reveals that at lower concentrations up to 250 μg ml−1, the synthesized material SrFe12-xYxO19 for X = 0.00 and X = 1.0 promotes the growth of cell and hence represents non-toxic and biocompatible behavior with cell. Hence anticipation can be made that it may be used for biological and biomedical applications such as bone replacement, magnetic drug delivery, and coating on metal implants. Thus, improved physical properties of Y3+ doped SHF nanomaterials pave the way for promising optical, magnetic, electrical, biological, and biomedical applications.