This review focused on rare earth upconversion nanophosphors (UCNPs), a particular class of emitters whose photoluminescence mechanism is of fundamental difference from that of conventional dyes and semiconductor quantum dots. We in the first section gave a brief summary on a variety of synthetic methodologies developed during the past decades. Instead of presenting an exhaustive reference list, we selected only a few representative examples, illustrating the merits and limits of each involved synthetic route. Then we surveyed the recent progress in the functionalization techniques for these nanomaterials, depicting the modification in microstructures and improvement in properties with respect to the parent nanoparticles. And finally, we emphasized their application in the research fields of biolabeling and energy transfer, narrating their superior performance benefiting from the unique excitation and emission properties. This review focused on rare earth upconversion nanophosphors (UCNPs), a particular class of emitters whose photoluminescence mechanism is of fundamental difference from that of conventional dyes and semiconductor quantum dots. We in the first section gave a brief summary on a variety of synthetic methodologies developed during the past decades. Instead of presenting an exhaustive reference list, we selected only a few representative examples, illustrating the merits and limits of each involved synthetic route. Then we surveyed the recent progress in the functionalization techniques for these nanomaterials, depicting the modification in microstructures and improvement in properties with respect to the parent nanoparticles. And finally, we emphasized their application in the research fields of biolabeling and energy transfer, narrating their superior performance benefiting from the unique excitation and emission properties.