Titanium dioxide nanopowders doped with different amounts of Fe ions were prepared by coprecipitation method. Obtained materials were characterized by structural (XRD), morphological (TEM and SEM), optical (UV/vis reflection and photoluminescence, and Raman), and analytical techniques (XPS and ICP-OES). XRD analysis revealed rutile crystalline phase for doped and undoped titanium dioxide obtained in the same manner. Diameter of the particles was 5–7 nm. The presence of iron ions was confirmed by XPS and ICP-OES. Doping process moved absorption threshold of TiO₂into visible spectrum range. Photocatalytic activity was also checked. Doped nanopowders showed normal and up-converted photoluminescence.