Eu:GaN powder synthesized using a high temperature ammonothermal process is known to be dark in appearance due to presence of Eu-containing absorbing particles. Improvement of the visual quality of the Eu:GaN powder is achieved by rinsing in dilute acids. Acid-rinsed Eu:GaN has photoluminescence (PL) enhanced by a factor of 3 when compared to as-prepared Eu:GaN. Such visually clear powders are used for making Eu:GaN nanoparticles of sizes 30-50 nm using a soft ball-milling technique. The particle size was determined using X-ray diffraction, scanning electron microscopy and a dynamic light scattering system. Longer durations of a "soft" ball-milling technique results in particle size reduction. These nanopowders show significant photoluminescence intensity with no yellow luminescence, and have a reduced PL intensity with increasing ball-milling time. Eu:GaN nanopowder embedded in a KBr matrix shows at least a 10 x improvement in transmittance when compared to as-prepared powders. The improvement of transmittance depends on both the concentration and particle size. This improved transmittance suggests that such a transparent matrix could be used as a laser gain medium. (C) 2009 Elsevier B.V. All rights reserved.