A channel waveguide on an erbium doped phosphate laser glass (Kigre Q89) was fabricated by a dry silver-film ion exchange technique, and its gain properties were studied experimentally. The propagation loss of the fabricated waveguide was 0.6 dB/cm at 1.3 μm. Er3+ concentration of 1 × 1020 ions/cm3 was chosen so that no concentration quenching occurred. This was confirmed by measuring a fluorescence lifetime of 1.54 μm (8.4 ms). Gain of the fabricated waveguide was measured by using a Ti:sapphire laser at a wavelength of 977 nm and a laser diode of 1.530 μm producing pump and signal beams respectively. The signal wavelength used for the experiments was shorter than the emission peak, and the measured gain of the 1.8 cm waveguide was comparable to the total loss. However, the model which adopted experimental conditions showed that lasing is expected at the emission peak with a 3.6 cm long waveguide fabricated by current method. Calculations results showed that the 6.5 dB gain can be realized at 300 mW pump power with a 5.4 cm long waveguide, provided that mode overlap can be increased by 25% and propagation loss can be reduced by 50%. No significant upconversion effect was observed up to 1.1 × 106 W/cm2 pump intensity.