Photon-upconverting nanoparticles (UCNPs) can be excited by near-infrared light and emit visible light (anti-Stokes emission) which prevents autofluorescence and light scattering of biological samples. The potential for background-free imaging has attracted wide interest in UCNPs in recent years. Small and homogeneous lanthanide-doped UCNPs that display high upconversion efficiency have typically been synthesized in organic solvents. Bioanalytical applications, however, require a subsequent phase transfer to aqueous solutions. Hence, the surface properties of UCNPs must be well designed and characterized to grant both a stable aqueous colloidal dispersion and the ability to conjugate biomolecules and other ligands on the nanoparticle surface. In this review, we introduce various routes for the surface modification of UCNPs and critically discuss their advantages and disadvantages. The last part covers various analytical methods that enable a thorough examination of the progress and success of the surface functionalization.