Two mole percentage Er‐doped (K0.5Na0.5)1 − xLixNbO3 ceramics have been prepared and their dielectric, ferroelectric, and photoluminescence (PL) properties have been investigated. Under an excitation of 980 nm, the ceramics exhibit intense up‐conversion luminescent emission at 548 nm (green), weak emission at 660 nm (red) as well as strong down‐conversion luminescent emission in near‐infrared (NIR) (1.40–1.65 μm) and mid‐infrared (2.60–2.85 μm) regions. Probably due to the induced structure distortion and reduced local symmetry, the PL intensities of the green, red as well as mid‐infrared emissions are enhanced by the doping of Li+. Our results show that the Li‐doping is effective in establishing a dynamic circulatory energy process to further enhance the PL intensity of the mid‐infrared emission at the expense of the NIR emission. At the optimum doping level of Li+ (~6 mol%), the full bandwidth at half maximum of the mid‐infrared emission reaches a very large value of ~250 nm. The ceramics also exhibit good ferroelectric properties, and thus they should have great potential for multifunctional optoelectronic applications.