The elucidation of local structure, excitation-dependent spectroscopy, and defect engineering in lanthanide ion-doped phosphors was a focal point of research. In this work, we have studied Eu3+-doped BaZrO3 (BZOE) submicron crystals that were synthesized by a molten salt method. The BZOE crystals show orange–red emission tunability under the host and dopant excitations at 279 nm and 395 nm, respectively, and the difference is determined in terms of the asymmetry ratio, Stark splitting, and intensity of the uncommon 5D0 → 7F0 transition. These distinct spectral features remain unaltered under different excitations for the BZOE crystals with Eu3+ concentrations of 0–10.0%. The 2.0% Eu3+-doped BZOE crystals display the best optical performance in terms of excitation/emission intensity, lifetime, and quantum yield. The X-ray absorption near the edge structure spectral data suggest europium, barium, and zirconium ions to be stabilized in +3, +2, and +4 oxidation states, respectively. The extended X-ray absorption fine structure spectral analysis confirms that, below 2.0% doping, the Eu3+ ions occupy the six-coordinated Zr4+ sites. This work gives complete information about the BZOE phosphor in terms of the dopant oxidation state, the local structure, the excitation-dependent photoluminescence (PL), the concentration-dependent PL, and the origin of PL. Such a complete photophysical analysis opens up a new pathway in perovskite research in the area of phosphors and scintillators with tunable properties.