We report a green synthetic approach to the synthesis of water dispersible Ce3+/Tb3+-doped SrF2 nanocrystals, carried out using environment friendly microwave irradiation with water as solvent. The nanocrystals display strong green emission due to energy transfer from Ce3+ to Tb3+ ions. This strong green emission from Tb3+ ions is selectively quenched upon addition of Cu2+ ions, thus making the nanocrystals a potential Cu2+ ions sensing material. There is barely any interference by other metal ions on the detection of Cu2+ ions and the detection limit is as low as 2 nM. This sensing ability is highly reversible by the addition of ethylenediaminetetraacetic acid (EDTA) with the recovery of almost 90% of the original luminescence. The luminescence quenching and recovery cycle was repeated multiple times without much effect on the sensitivity. The study was extended to real world water samples and obtained similar results. In addition to the sensing, we strongly predict the small size and high luminescence of the Ce3+/Tb3+-doped SrF2 nanocrystals can be used for bioimaging applications.