The optical properties and defect emission of Cd doped (10 and 20 mol%) SnO2 nanoparticles were investigated. The structure and phase purity of the nanoparticles were studied from powder XRD pattern and micro-Raman spectra. XRD pattern revealed the effective substitution of Cd2+ in the Sn4+ sites. The application of microwave for the combustion reaction causes the formation of homogeneous fine particles with crystallite size around 7.5, 6.1 and 7.1 nm for pure SnO2, 10 mol% Cd doped and 20 mol% Cd doped SnO2 nanoparticles, respectively. The influence of fine particle size and doping of Cd2+ ions reduces the optical band gap of SnO2 nanoparticles from 3.08 to 2.98 eV. The existence of surface defects, induced by the smaller size of the particles and the heterovalent doping, was confirmed by the micro-Raman spectral analysis. ESR spectra revealed that there is a significant concentration of singly ionized oxygen vacancies present in undoped as well as Cd doped SnO2 nanoparticles. High surface defects of the nanoparticles give rise to the broad emission band in the wavelength range of 450–625 nm. The surface defects, causes the visible emission, includes the oxygen deficiency produced by the doping of the cation (Cd2+) with low oxidation state than that of host cation (Sn4+), tin interstitials and dangling bonds. The excitation of pure and Cd doped SnO2 nanoparticles with 325 nm laser leads to the emission of yellow light and the emission intensity varied by Cd doping. A wide excitation band (300–400 nm) observed for the emission at 530 nm revealed that visible emission can be obtained by the pure and Cd doped SnO2 nanoparticles under the excitation of UV light. White emission with high CRI of 85.6 and CIE Coordinates of (0.32, 0.30) is achieved by exciting the mixture of blue phosphor with yellow emitting SnO2 nanoparticles using 375 nm LED chip.