Luminescent tetragonal‐ZrO2 (t‐ZrO2) nanocrystals were synthesized using an optimized combustion method without post‐synthesis annealing and characterized using X‐ray diffraction, electron microscopy, Raman spectroscopy, X‐ray photoelectron spectroscopy, UV–Vis. spectroscopy, photoluminescence spectroscopy, thermoluminescence (TL), and vibrating sample magnetometry. The as‐synthesized t‐ZrO2 nanocrystals have a bandgap of 4.65 eV and exhibit defect‐assisted blue emission (Commission Internationale de I'Elcairage coordinates 0.2294, 0.1984) when excited at 270 nm. The defect states were qualitatively and quantitatively analyzed using TL after irradiating nanocrystals with γ‐ and UV radiations at various doses. The TL glow curves show intense emission in the high‐temperature region from 523 to 673 K for both UV‐ and γ‐irradiated samples; however, another less‐intense TL peak was also observed in the low‐temperature region from 333 to 453 K with γ irradiation at higher doses, indicating the formation of shallow trapping states. The activation energies, frequency factor, and order of kinetics were estimated using the computerized glow curve deconvolution method for the shallow and deep traps for γ‐ and UV‐irradiated samples. The present study shows that phase‐stabilized t‐ZrO2 nanocrystals are potential candidates for luminescence‐based applications.