In this study, for the first time the diamagnetic 5d0 Ta5+ ions and Ta2O5 nanocrystals were utilized to enhance the thermal stability, optical linear and nonlinear, and Faraday rotation of diamagnetic glasses. Temperature‐dependent crystal morphology, phases, and structures of Ta2O5 were studied and 50 nm spherical δ‐Ta2O5 nanocrystal was obtained and shown decreased band gap of 3.68 eV. Transparent Ta2O5 nanocrystal doped diamagnetic glasses were obtained, and the embedded Ta2O5 nanocrystals have size ranging from 50 to 80 nm. EDX, XRD, FT‐IR, and Raman analysis indicated that Ta2O5 partially dissolved into glass as TaO6 octahedral units, while partially residual as undissolved Ta2O5 nanocrystals. Ta5+ ions strengthened the network connectivity of 1%–5% Ta2O5‐doped glasses, but Ta5+ acted as network modifier in 10% doped sample and changed the frame coordination units of glass. Therefore, 1% and 5% Ta2O5‐doped glasses showed high Tg and large thermal stability (107° and 120°). All Ta2O5‐doped glasses exhibited broad and intense optical emission at 420 nm, excellent nonlinear refractive index (5.22 × 10−14 cm2/W) and giant Verdet constant (56.19 rad/T·m) due to the increase in density, polarizability, and diamagnetic susceptibility by Ta2O5 doping.