Lab-grown diamond films, vital for advanced electronics and biomedical applications, pose production challenges. This study investigates a simplified method to create fluorescent diamond films and assesses their potential as temperature sensors. Polycrystalline diamond (PCD) films functionalized with NaYF 4 :Er,Yb upconversion nanoparticles (UCNPs) have been developed, and their temperature sensitivity of luminescence has been evaluated. UCNPs functionalized on surface-treated PCD films (UCNPs−TPCD) exhibit superior temperature sensitivity (S r = 1.08% at 300 K −1 ) compared with the as-prepared UCNPs and UCNPs coated on the as-grown PCD films (UCNPs−PCD). Surface oxidation of PCD films facilitates uniform UCNP distribution, verified through upconversion luminescence, XPS, IR, and Raman spectroscopy alongside SEM and AFM. An increase in the temperature of the diamond lattice due to 980 nm laser irradiation leads to an increase in the population of the 2 H 11/2 level of Er 3+ and the associated increase in the fluorescence intensity ratio and improved temperature sensitivity of UCNPs functionalized on the treated diamond surface. Hysteresis in luminescence is observed for the first time in PCD films functionalized with UCNPs, attributed to an increased temperature from the absorption of 980 nm light by diamond films.