NaGd(WO₄)₂:Yb³⁺/Er³⁺ (NGW:Yb³⁺/Er³⁺) phosphors co-doped with Yb³⁺ (12–24 at%, at% i.e. atomic percent) and Er³⁺ ions (1–10 at%) were synthesized by a facile hydrothermal process. Under 980 nm excitation, NGW:Yb³⁺/Er³⁺ phosphors exhibited strong green upconversion (UC) emission bands centered at 532 nm (²H_11/2 → ⁴I_15/2) and 554 nm (⁴S_3/2 → ⁴I_15/2) and weak red emissions near 658 and 671 nm (⁴F_9/2 → ⁴I_15/2). The optimum doping concentrations of Er³⁺ and Yb³⁺ for the highest emission intensity were determined by using X-ray diffraction (XRD) and photoluminescence (PL) analyses. Concentration dependent studies revealed that the optimal composition was realized for the 20 at% Yb³⁺ and 6.0 at% Er³⁺-doping concentration with a strong green emission. A possible UC mechanism for NGW:Yb³⁺/Er³⁺ depends on the pump power is discussed. The temperature dependence of the fluorescence intensity ratios (FIR) for the two green UC emission bands peaking at 532 and 554 nm was studied in the range of 293–573 K under excitation by a 980 diode laser and the maximum sensitivity was approximately 114.96 × 10⁻⁴ K⁻¹ at 453 K. This indicates that NGW:Yb³⁺/Er³⁺ phosphors are potential candidates for optical temperature sensors with high sensitivity.