Due to the widespread application of rare earth oxide nanoparticles in various fields, their release into the environment is inevitable, and their potential toxicity and ecological impact have become a concern. Yttrium oxide nanoparticles are important rare earth oxide nanoparticles; however, their impact on plants and the molecular mechanism underlying their influence on plant growth and development are unclear. In this study, we found that yttrium oxide nanoparticles at concentrations exceeding 2 mM significantly inhibited the growth of Arabidopsis seedlings. Using Arabidopsis marker lines for auxin signaling, we found that the application of yttrium oxide nanoparticles resulted in disordered auxin signaling in root cells. Auxin signaling in the cells of the quiescent center and columella stem cells decreased, while auxin signaling in the cells of the stele was enhanced. In addition, trypan blue staining showed that yttrium oxide nanoparticles induced root cell death. Transcriptome analysis showed that the nanoparticles specifically inhibited the expression of lignin synthesis-related genes, activated the MAPK signaling pathway, and enhanced the ethylene and abscisic acid signaling pathways in plants. This study demonstrates the phytotoxicity of yttrium oxide nanoparticles at the molecular level in Arabidopsis, and it provides a new perspective on how plants respond to rare earth oxide stress.