This review article compiles the recent achievements made in layered rare-earth (RE) hydroxide (LRH), including controlled crystallization, structural and morphological features, anion exchange, nanosheet exfoliation, and application in the field of luminescence for both the Ln₂(OH)₅(A^x-)_1/x·nH₂O (251-LRH) and Ln₂(OH)₄(A^x-)_2/x·nH₂O (241-LRH) phases. The luminescent properties of the LRHs themselves, the oxide, oxysulfate, and oxysulfide phosphors derived from the LRHs via controlled calcination, and the highly oriented transparent phosphor films of enhanced luminescence and/or novel emission features are summarized.