In order to obtain better luminescent properties, the phosphor materials should have a homogeneous distribution of the activator in the host matrix, with high crystallinity and phase purity [11]. Due to the aforementioned advantages, various methods have been employed for the synthesis of this material, including the sol-gel process, precipitation, hydrothermal, combustion, spray pyrolysis [12], and solid-state reaction (SSR) [10,11]. However, the products obtained by the SSR method have some disadvantages, such as non-homogeneous phase distribution, a bulky and non-uniform particle shape, which may degrade the luminescence properties of the phosphors. Such problems have been overcome by using a novel liquid-phase precursor approach or the confined space method using a template source, which may be a good way to prepare these materials with excellent luminescence properties [12,13]. Particle coating technology has applications in drug layering [14], security pigments [12], cosmetics [15], and specialty pigments. The coating ability can be controlled by employing electrostatic interaction, along with modifying the surface of particles before coating. As nanosized particles are unstable due to their high specific surface area, wet-in-wet coating is easier to be used for coating the base material surface equally in an aqueous environment. We have recently reported that lanthanide-based nanophosphor and its dispersed nanosol with good luminescent property have the potential to be applied for security purposes [16]. Mica flake coated by CeO2:Eu3+/Na+ as a red phosphor was produced as a security pigment that emits red light luminescent enough to be visible to the eyes [12,17]. We have also published the Gd2O3:Eu/Bi as a red-emitting nanophosphor coated on TiO2/mica as a pearl pigment for security purposes [18]. Generally, the pearl pigments have a two-dimensional substrate such as the mica flake with a low refractive index and TiO2 as a coating layer with a high refractive index. The pearl pigments are mainly used as a security material with gloss properties due to their unique sparkling and color change [18,19,20]. These materials are expected to be used as next-generation anti-counterfeiting pigments [12,18]. To make high luminescent pearl-type security materials, there are two ways, one is the pearl pigment should have an excellent fluorescent property and another way is to coat high luminescent nanophosphor on its surface. However, the coating of high luminescent nanophosphor is a good way to obtain a high luminescent security pigment. Y2O3:Eu3+ shows a good red emission due to the Eu3+ under 254 nm UV excitation. In order to achieve better luminescent characteristics, the template method is considered to be a better synthesis technique to obtain a high luminescent nanophosphor. We have hypothesized to prepare Y2O3:Eu3+ by the template method and to convert it into a highly dispersed nanosol form under a controlled bead-mill wet process and to coat them on MF or TMF. The Y2O3:Eu3+ is experimentally to coated on MF or TMF by optimizing their coating factors, such as pH, stirring temperature, coating amount, and calcination temperature. Finally, the luminescent property of Y2O3:Eu@MF or Y2O3:Eu@TMF red phosphors was also investigated. However, no report has been published on preparing Y2O3:Eu3+ nanosol using the bead-mill wet process, and their coating on MF or TMF. Finally, this study confirmed that Y2O3:Eu3+ coated on MF or TMF can be applied for the preparation of a photo-functional security pigment with anti-counterfeiting properties.