Energy losses inherent to the conversion of sunlight to electricity in solar cells are mainly due to the so-called spectral mismatch: low energy photons are not absorbed while the energy of high energy photons is only partly used by the solar cell. The losses can be significantly reduced by adapting the solar spectrum. A promising avenue is the use of a downconversion material where one higher energy visible (blue-green) photon is “cut” into two lower-energy near-infrared photons that both can be used by the solar cell. Here the efficiency of downconversion for the (Nd3+,Yb3+) couple in YF3 is studied to investigate if efficient two-step energy transfer occurs from the 4G9/2 level of Nd3+ (situated around 21 000 cm−1 or 470 nm) exciting two neighboring Yb3+ ions to the 2F5/2 level (around 10 000 cm−1 or 1000 nm). Optical measurements of YF3 doped with Nd3+ and Yb3+ show that there is efficient energy transfer from Nd3+ to Yb3+, but downconversion from the 4G9/2 level does not occur due to fast multiphonon relaxation. Relaxation from this level to lower-energy levels populates the 4F3/2 level of Nd3+ from which efficient one-step energy transfer to Yb3+ occurs. Analysis of the luminescence decay curves for different Yb3+-concentrations using Monte Carlo simulations reveals a high nearest neighbor transfer rate (3.3×105 s−1) through a dipole-dipole interaction mechanism. Downconversion is observed from the 4D3/2 level (situated in the UV, around 28 000 cm−1 or 360 nm) with an estimated quantum efficiency up to 140%. For application in solar cells this UV to 2 NIR downconversion will only result in a marginal reduction of spectral mismatch losses