High-temperature treatments are necessary for luminescence ‘activation’ of sputterdeposited, RE-doped, III-nitride phosphor materials. We report an investigation of the activation process in crystalline and amorphous Tb-doped AlN films. These films were characterized before and after thermal activation at temperatures up to 1000° C by cathodoluminescence (CL), static and time-resolved photoluminescence (PL), and secondary ion mass spectrometry (SIMS). The results suggest that the absence of luminescence in unactivated and in old activated samples is due to rapid quenching of the RE excited state. Furthermore, the quenching in the activated, aged samples appears to be due to sorption of ambient water vapor. Energy transfer to a harmonic of the O-H vibration is a likely quenching pathway in these samples. Unfortunately, this water-related quenching mechanism is implausible as a candidate in freshly-made, unactivated samples since water is excluded from the growth chamber.