The nominations are made by a jury consisting of journalists and coaches for top clubs and prominent national teams in Europe.
Gerhardsson competes with Chelsea's coach Emma Hayes and Barcelona's Lluís Cortés for the award, both taking their respective teams to the Champions League final last season.
Peter Gerhardsson recently led Sweden to the final of the Olympics, where there was a loss against Canada after penalties.
The nominations are based on the performances during the 2020–2021 season.
Uefa has also announced the nominations for coach of the year on the men's side, as well as best women's and men's players.
Italian national team captain Roberto Mancini, Manchester City's coach Pep Guardiola and Chelsea's Thomas Tuchel are fighting to take home this year's coach for men's team in Europe.
Champions League champions Barcelona dominate the nominations for the best women's player of the year.
Teammates Jennifer Hermoso, Lieke Martens and Alexia Putellas settle for the award.
On the men's side, it's the midfielders' year.
Chelsea duo N'Golo Kanté and Jorginho are nominated along with Manchester City's game engine Kevin de Bruyne.