GaPO4 nanoparticles having hexagonal structure with different amounts of Eu3+ ions were prepared at 130 degrees C based on precipitation method in glycerol medium. The interaction between GaPO4 nanoparticles and Eu3+ ions has been investigated using Eu3+ luminescence and P-31 magic angle spinning nuclear magnetic resonance (MAS NMR) techniques. Based on these studies, it is established that Eu3+ ions up to 2.5 at.% replace the protons of the hydroxyl groups attached on Ga3+ ions present on the surface of the nanoparticles and above 2.5 at.%, a separate EuPO4 phase is formed. The anisotropy parameters derived from the side band intensities of the P-31 MAS NMR patterns from these samples confirmed the surface ion exchange at low Eu3+ concentration (2.5 at.%) and EuPO4 phase formation at high Eu3+ concentration (5 at.% and more). The increase in anisotropy at high Eu3+ contents has been attributed to the presence of paramagnetic EuPO4 phase.