A dual mode rare-earth based oxide phosphor (Y_0.977Yb_0.02Er_0.003NbO₄), demonstrating both down conversion (DC) and upconversion (UC) emission, has been developed using a facile solid state reaction method which can be easily scaled-up for large quantities. In the DC studies, the material exhibits a strong blue emission with a long decay time (4.36 μs), corresponding to the charge transfer band of [NbO₄]³⁻ under UV excitation (262 nm), and a green emission of the Er³⁺ ions under blue (379 nm) excitation. Furthermore, it has been noticed that under infrared (976 nm) excitation, this phosphor shows strong green and red emission along with relatively weak emission bands in the UV-blue and IR regions, which confirm the compatibility of this phosphor for UC too. In the UC emission, the ²H_11/2 → ⁴I_15/2 and ⁴S_3/2 → ⁴I_15/2 transitions of the Er³⁺ ion portray a temperature dependent behaviour and have been used for temperature sensing (optical thermometry) using the fluorescence intensity ratio (FIR) method. The maximum sensitivity is found to be 0.0073 K⁻¹ at 473 K, which is better in comparison with other host matrixs reported so far. The results suggest that this dual mode phosphor could be an exceptional choice for next generation luminescence-based temperature sensing devices as well as in advanced display devices.