In this present work, a PVA/PVP-blend polymer was doped with various concentrations of neodymium oxide (PB-Nd+3) composite films using the solution casting technique. X-ray diffraction (XRD) analysis was used to investigate the composite structure and proved the semi-crystallinity of the pure PVA/PVP polymeric sample. Furthermore, Fourier transform infrared (FT-IR) analysis, a chemical-structure tool, illustrated a significant interaction of PB-Nd+3 elements in the polymeric blends. The transmittance data reached 88% for the host PVA/PVP blend matrix, while the absorption increased with the high dopant quantities of PB-Nd+3. The absorption spectrum fitting (ASF) and Tauc’s models optically estimated the direct and indirect energy bandgaps, where the addition of PB-Nd+3 concentrations resulted in a drop in the energy bandgap values. A remarkably higher quantity of Urbach energy for the investigated composite films was observed with the increase in the PB-Nd+3 contents. Moreover, seven theoretical equations were utilized, in this current research, to indicate the correlation between the refractive index and the energy bandgap. The indirect bandgaps for the proposed composites were evaluated to be in the range of 5.6 eV to 4.82 eV; in addition, the direct energy gaps decreased from 6.09 eV to 5.83 eV as the dopant ratios increased. The nonlinear optical parameters were influenced by adding PB-Nd+3, which tended to increase the values. The PB-Nd+3 composite films enhanced the optical limiting effects and offered a cut-off laser in the visible region. The real and imaginary parts of the dielectric permittivity of the blend polymer embedded in PB-Nd+3 increased in the low-frequency region. The AC conductivity and nonlinear I-V characteristics were augmented with the doping level of PB-Nd+3 contents in the blended PVA/PVP polymer. The outstanding findings regarding the structural, electrical, optical, and dielectric performance of the proposed materials show that the new PB-Nd+3-doped PVA/PVP composite polymeric films are applicable in optoelectronics, cut-off lasers, and electrical devices.