Single-phase, polycrystalline Er(x)Y(2-x)SiO(5) thin films were deposited by reactive ion-beam sputter deposition and rapid thermal annealing. Due to the crystalline nature, the silicate thin films provide peak Er(3+) emission cross-section of 0.9 +/- 0.02 x 10(-20) cm(2) that is higher than that in silica. Optical gain, with near 60% inversion, is achieved via optical pumping of a single-mode, ridge-type waveguide with the silicate core with an Er concentration of 1.7 x 10(20) cm(-3). Analysis of pump-power dependence of the optical gain and spontaneous emission intensity of Er(3+) indicate that the gain is limited by cooperative upconversion process, whose coefficient is determined to be (8 +/- 3) x 10(-17) cm(3)/sec.