We have studied the mechanism of visible photoluminescence (PL) from surface-oxidized Si crystallites of 3.7 nm diameter. Under intense laser-pulse illumination, two PL bands are clearly observed: a fast-decay blue-green PL band and a slow-decay red PL band. Time-resolved PL-spectrum measurements indicate that carriers generated in the core state are rapidly localized into the lower-energy surface states. Spectroscopic analysis indicates that the slow-decay red PL is caused by the hopping-limited recombination process in the surface-localized state of the crystallite, while the blue-green PL is caused by the band-edge emission from the core state of the crystallite.