Dy³⁺-doped ZnSe quantum dots (QDs) were successfully synthesized via a high-temperature wetchemical method using 1-octadecene as the reaction medium. Structural, morphological, and optical studies have been used to investigate optical properties and interactions between the substrate and the dopant. X-ray diffraction confirmed the formation of single-phase cubic ZnSe with a slight shift of diffraction peaks toward lower angles, indicating lattice expansion due to the substitution of Zn²⁺ by larger Dy³⁺ ions. TEM revealed nearly spherical QDs with particle sizes of 5–7 nm. Photoluminescence spectra exhibit characteristic Dy³⁺ emission bands corresponding to the ⁴F₉/₂ → ⁶HJ (J = 15/2, 13/2, 11/2, 9/2) transitions, with dominant yellow emission at ~582 nm. The emission intensity increases with Dy³⁺ concentration and reaches a maximum at 2 mol% before decreasing due to concentration quenching. Spectral overlap between the ZnSe host emission and Dy³⁺ excitation bands confirms an efficient hostsensitized energy transfer mechanism. Judd–Ofelt (JO) theory was applied to determine the optical intensity parameters (Ω₂, Ω₄, Ω₆) and evaluate the local environment around Dy³⁺ ions in the ZnSe crystal lattice. The obtained trend (Ω₂ > Ω₆ > Ω₄) indicates a moderately asymmetric coordination around Dy³⁺ ions. In addition, the temperature-dependent photoluminescence properties of ZnSe:Dy³⁺ QDs were investigated in the temperature range of 200–350 K, revealing good spectral stability with an activation energy of ~42.6 meV. The lifetime decreases as Dy³⁺ concentration increases according to the Inokuti–Hirayama law, suggesting that dipole-dipole interaction is the primary energy transfer mechanism. These results provide new insights into the spectroscopy and energy transfer of Dy³⁺ ions in ZnSe QDs.