Erbium doped yttrium oxide films (Er:Y2O3) upconversion layers were prepared by aerosol-UV assisted metal-organic chemical vapor deposition (MOCVD) at 410C and annealed at 800°C. The effect of erbium concentration on their structure and optical properties were investigated using scanning electron microscope, X-ray diffraction and transmission electron microscopy. By using 488nm laser, the properties of upconversion luminescence and energy transfer processes were studied in detail for the different concentration of erbium. The remarkable decrease of upconverted emission intensity and the quenching of the 2P3/2→4I9/2 and 2H9/2→4I13/2 transitions were observed in the Er:Y2O3 films with high erbium concentration. The absolute Up-Conversion Quantum Yield (UC-QY) of each film was measured for the UC emissions centered at 530 and 560nm at varying excitation power densities. UC-QY analysis has revealed that 2mol.% Er:Y2O3 film possess the highest total quantum yield of 4.07±0.1% with a power density of 15.3W/cm2. Moreover, the Er3+ luminescence analyzed in the IR region, shows 4I13/2 lifetimes was found to be 6.7ms for film deposited with 2mol% erbium. These results show that this film is promising as an efficient up-conversion layer suitable for many photonic applications.