Magnesium yttrium oxide (MgO-Y2O3) nanocomposites have been purposefully tailored using an oxalate precursor pathway. Commonly, MgO-Y2O3 nanocomposites possessed a significant technological challenge in electroceramics; particularly remarkable as the anode material for solid oxide fuel cells (SOFC). In this regard, different weight ratios, % of MgO and Y2O3 including (20:80), (50:50) and (80:20) were fabricated based on oxalic acid as a fuel in acidic medium. Indeed, the impact of the annealing temperature on the phase composition, crystallite size, morphology and optical properties was investigated using X-ray diffraction, field emission electron microscope (FESEM), TEM, FTIR and UV-VIS-NIR spectrophotometer. The FESEM results showed the nanocomposite had a cubic like structure with the fine grain sizes of 0-150 nm because of the rapid solidification. The band gap energy was found to be 4.83, 5.10 and 5.08 eV with increasing the ratio of Mg2+ ion from 20 to 50 and 80, respectively. Eventually, our currently studies consider to be an important achievement to investigate and recognize the features of the MgO-Y2O3 system for different applications involving microwave systems, advanced displays (field emission display, plasma display, electroluminescent display), ultra-fast sensors, durable, infrared windows and lasers.