Chemical precipitation at the freezing temperature of similar to 4 degrees C has directly yielded layered rare-earth hydroxide [LRH, Ln(2)(OH)(5)-NO3 center dot nH(2)O, Ln = Y0.95Eu0.05] nanosheets (up to 7 nm thick) for the Y/Eu binary system, with the interlayer NO3- exchangeable with SO42-. Calcining the sulfate derivative at 1100 degrees C for 4 h produces well-dispersed and readily sinterable Ln(2)O(3) red phosphor powders (similar to 14.8 m(2)/g) that can be densified into highly transparent ceramics via optimized vacuum sintering at the relatively low temperature of 1700 degrees C for 4 h (average grain size similar to 14 mu m; in-line transmittance similar to 80% at the 613 nm Eu3+ emission or similar to 99% of the theoretical transmittance of Y2O3 single crystal). Our systematic studies also found that (1) the extent of SO42 - exchange and the interlayer distance of LRH are both affected by the SO42-/Ln(3)(+) molar ratio (R), and an almost complete exchange is achievable at R = 0.25 as expected from the chemical formula (one SO42- replaces two NO3- for charge balance). The optimal R value for sintering, however, was found to be 0.03; (2) The Ln(3+) concentration for LRH synthesis substantially affects properties of the resultant oxides, and hard agglomeration has been significantly reduced at the optimized Ln(3+) concentration of 0.05-0.075 mol/L; (3) Sulfate exchange significantly alters the thermal decomposition pathway of LRH, and was found essential to produce well-dispersed and highly sinterable oxide powders; (4) Both the oxide powders and transparent ceramics exhibit the typical red emission of Eu3+ at similar to 613 nm (the D-5(0) -> F-7(2) transition) under charge-transfer (CT) excitation. Red-shifted CT band center, stronger excitation/emission, and shorter fluorescence lifetime were, however, observed for the transparent ceramics.