Abstract: Li-Yb co-doped nano-crystalline ZnO has been synthesized by a method of thermal growth from the salt mixtures. X-ray diffraction, transmission electron microscopy, atomic absorption spectroscopy and optical spectroscopy confirm the doping and indicate that the dopants may form Li-Li and Yb3+-Li based nanoclusters. When pumped into the conduction and exciton absorption bands of ZnO between 250 to 425 nm, broad emission bands of about 100 nm half-height-width are excited around 770 and 1000 nm, due to Li and Yb dopants, respectively. These emission bands are activated by energy transfer from the ZnO host mostly by quantum cutting processes, which generate pairs of quanta in Li (770 nm) and Yb (1000 nm) emission bands, respectively, out of one quantum absorbed by the ZnO host. These quantum cutting phenomena have great potential for application in the down-conversion layers coupled to the Si solar cells.