Rare earth nanomaterials with nanometer to submicronmeter crystalline sizes are an important class of materials displaying interesting physical and chemical properties especially in luminescence and catalysis fields. In the last decade, the synthetic chemistry and exploring of novel properties on rare earth nanomaterials have been developed rapidly. This review on the topic of controlled synthesis and properties of rare earth nanomaterials should be useful with these literatures mostly up to 2009. The discussion focuses on the controlled synthesis of nanomaterials of inorganic rare earth compounds such as rare earth oxides, oxysalts, halogenides, chalcogenides, and therefore organized according to the different compounds discussed here. The successfully developed solution-based chemical methods, such as traditional sol—Cgel methods, combustion/flaming/pyrolysis methods hydrothermal/solvothermal methods, and those with modifications assisted with microwave radiation and sonochemical methods, the high boiling solvents-based heat treatment methods, and much more have been applied to the controlled synthesis of rare earth compound nanomaterials. Based on the well-developed controlling of pure phase, uniform size and shape, desired doping and composite structure, the rare earth nanocrystals show much more properties and promising application, such as in the medical fields, the energy conversion, pollution controlling, and various displays, which are also mentioned. With the newly developed techniques in top-down and bottom-up strategies for nanomaterials, it is reasonable to anticipate more rational and sophisticated rare earth nanostructures as well as their advanced applications in the future.