Zinc oxide–silica (ZnO/SiO2=20:80, molar ratio) nanocomposites consisting of ZnO nanoparticles embedded in a dielectric matrix were prepared by a sol–gel technique (spin coating). Optical transmittance, Raman effect and photoluminescence measurements of the composites indicated effective capping of the ZnO nanoparticles (radii 1.4–1.5 nm) in the host showing practically no variation of particle size with the post-deposition-annealing treatments. The blue shift of the band gap (4.23–4.29 eV) from that of bulk ZnO (3.3 eV) indicated strong carrier confinement for samples annealed at T≤773 K. Highly intense UV emission (approx. 4.2 eV) at room temperature could be obtained by annealing the composites in static oxygen atmosphere, while the visible defect-related luminescence (approx. 2.62 and 2.43 eV) could be reduced, resulting in a high intensity ratio (approx. 27) of the two.