Single-crystal Er3+:YAG has long been used as a laser material, and recent work has shown polycrystalline ceramic Er3+:YAG to be a suitable laser material, with benefits of lower cost and easier production. However, relatively little work has been done with the synthesis and spectroscopic characterization of Er3+:YAG nanocrystals. In this work, we present the synthesis of nanocrystalline Er3+:YAG and the results of comparative spectroscopic characterization with single-crystal and polycrystalline ceramic counterparts. The results show good agreement between the optical properties of the three hosts, with the nanocrystals demonstrating relatively higher intensity in the 1.53 μm emission. These results demonstrate the viability of Er3+:YAG nanocrystals as a potential laser material.