We have investigated the effects of nanometer-sized silver particles on the optical properties of Eu3+ ions in SiO2 glass. Glass samples were prepared by the sol-gel method. The mean particle size and volume fraction of silver particles, which were estimated from UV-VIS absorption spectra using Mie-Drude theory modified by electron mean free path model, rapidly increased with the reduction time of Ag+ up to ∼3 min at 900 °C. The fluorescence from Eu3+ ions for the excitation by N2 laser was greatly enhanced in the presence of silver particles of 4.3 nm size. Our experimental results suggest that the origin of enhanced fluorescence is from local field enhancement around Eu3+ ions, owing to the surface plasmon resonance of small silver particles.