The effect of silver (Ag) nanoparticles on the upconversion emission properties of Er3+ ions in oxyfluoride glasses was investigated, and a mechanism of the energy transfer proposed. The integrated intensity ratios between 522 and 545 nm emission bands of Er3+ ions in glasses containing Ag nanoparticles were strongly dependent on the size of the Ag nanoparticles as well as on the intensity of the 800 nm excitation laser. When the absorption of Ag nanoparticles overlapped with the 2H(11/2) and 4S(3/2) energy levels in Er3+ ions, a strong energy transfer occurred from Er3+: 2H(11/2), 4S(3/2) levels to Ag nanoparticles. This energy was then converted to a temperature rise in the vicinity of Er3+ ions, eventually leading to the large increase in the integrated intensity ratios. The estimated effective temperature was approximately 200 K higher than the experimental temperature when the excitation power was 700 mW.