Novel IR-transparent ceramics of erbium-doped Lu2O3-MgO and Sc2O3-MgO composites have been successfully obtained using a combination of glycine–nitrate self-propagating high-temperature synthesis and vacuum hot-pressing methods. Composites have densities greater than 99.5% of those calculated by X-ray diffraction and consist of uniformly distributed submicron grains of magnesium and rare earth oxides. The transmittances of 1.5 mm thick composites are as high as 84.5% and 78.9% at ~5 µm for Er:Lu2O3-MgO and Er:Sc2O3-MgO, respectively. Both composites are favorable matrices for doping with erbium ions, which exhibit intense luminescence in the visible, near, and mid-IR under relevant excitation. The position of the luminescence bands is similar to Er:Lu2O3and Er:Sc2O3ceramics; the lifetimes of the4I13/2state are 8.85 ± 0.1 ms and 5.7 ± 0.2 ms for 3%Er:Lu2O3-MgO and 3%Er:Sc2O3-MgO, respectively.