Rare earth magneto-optical nanocrystalline oxides provide a material that is transparent in the visible range and has a high magnetic response to external magnetic fields. The material can be manufactured using current activated pressure assisted densification (CAPAD). The result is a rare earth magneto-optical nanocrystalline oxide having an average grain size of less than about 100 nm and a Verdet constant greater than or equal to about 300 rad T−1 m−1 for light having a wavelength of about 632.8 nm.