The design and production of co-doped diluted magnetic semiconductor nanostructures for the development of spin-related operating electronic devices have gained considerable attention owing to their formidable characteristics. In this study, we strived to fabricate ZnO, Zn_0.98Ni_0.02O, Zn_0.97Ni_0.02Er_0.01O, and Zn_0.96Ni_0.02Er_0.02O nanoparticles. The successful penetration of Ni and Er ions into the ZnO host material was confirmed through wide-ranging structural analyses. A slight change in the bandgap of ZnO was obtained by doping and co-doping. The photoluminescence spectra revealed that doping and co-doping induced various emissions as well as structural defects in the fabricated nanoparticles. Magnetic hysteresis loops revealed that the ZnO and Zn_0.98Ni_0.02O nanoparticles possessed a paramagnetic nature. However, the Zn_0.97Ni_0.02Er_0.01O and Zn_0.96Ni_0.02Er_0.02O nanoparticles exhibited robust ferromagnetism with clear hysteresis loops. Bound magnetic polaron behavior is well-anticipated to describe the ferromagnetism in the synthesized nanoparticles. Hence, (Ni + Er) co-doping is a promising approach for extending the ferromagnetic nature of the ZnO system for spin-based electronic devices.