Using the density functional theory, we study the structural and lattice dynamical properties of europium sesquioxide (Eu2O3) in the cubic, trigonal, and monoclinic phases. The obtained lattice parameters and energies of the Raman modes show a good agreement with the available experimental data. The Eu-partial phonon density of states calculated for the cubic structure is compared with the nuclear inelastic scattering data obtained from a 20 nm thick Eu2O3 film deposited on a YSZ substrate. A small shift of the experimental spectrum to higher energies results from a compressive strain induced by the substrate. On the basis of lattice and phonon properties, we analyze the mechanisms of structural transitions between different phases of Eu2O3.