The crystallization evolution of the nanostructured Si （ns-Si） in the Er-doped Si/Al2O3 multilayer fabricated by using pulsed laser deposition technique and its effects on the Er3+ luminescence at 1.54 μm are investigated. Raman scattering and transmission electron microscopy measurements are used to characterize the microstructure evolution of the ns-Si during annealing treatment processes. The maximum photoluminescence intensity is obtained in the sample with ultrathin ns-Si sublayers annealed at 600—700 ℃, where the density, the size of Si nanocrystals, the interaction distance, and the optimized local environment for effectively activating the Er3+ are well controlled. From the analysis of the decay process of time-dependent luminescence, two decay channels are considered, the fast and slow decay channels. The bulk-like Si is responsible for the fast process and the Si nanocrystals are responsible for the slow decay process.