The photoluminescence (PL) spectra and kinetics of erbium-doped layers of silicon nanocrystals dispersed in a silicon dioxide matrix (nc-Si/SiO 2) are studied. It was found that optical excitation of nc-Si can be transferred with a high efficiency to Er3+ ions present in the surrounding oxide. The efficiency of energy transfer increases with increasing pumping photon energy and intensity. The process of Er3+ excitation is shown to compete successfully with nonradiative recombination in the nc-Si/SiO2 structures. The Er3+ PL lifetime was found to decrease under intense optical pumping, which implies the establishment of inverse population in the Er3+ system. The results obtained demonstrate the very high potential of erbium-doped nc-Si/SiO2 structures when used as active media for optical amplifiers and light-emitting devices operating at a wavelength of 1.5 μm.