Cerium-doped Titanium dioxide (TiO2) nanoparticles are prepared by sol-gel method. Doping shifts the UV absorption edge of TiO2 to the visible region, making it efficient for visible light photocatalysis. Incorporation of cerium decreases the effective band gap of TiO2 and increases the Urbach energy levels. At the dopant concentrations of 0.015 and 0.025 mol the luminescence intensity increases compared to undoped TiO2; however, the luminescence is quenched at 0.035 mol. Quenching of luminescence indicates efficient separation of charge carriers. Undoped TiO2 is showing poor performance in the photocatalytic degradation of methyl orange under visible light. However, on cerium doping its photoactivity is increased, and is drastically enhanced at 0.035 mol of cerium. Further increase in Ce3+ doping level to 0.045 mol results in the reduction of the photodegradation of the dye. On UV irradiation, entire samples show good photocatalytic activity up to 30 min, but their efficiency decreases when irradiation time is increased to 45 min. Irradiation for longer time results in negative charging of the TiO2 surface with migrating electrons. The negatively charged surface repels the OH− ion and O2 molecule from adsorbing on its surface thus decreasing the availability of hydroxyl and superoxide radical for dye degradation.