In present work, synthesis of a nanohybrid material using Fe and MoS2 has been performed via a cost-effective and environmentally friendly route for sustainable manufacturing innovation. Rice straw extract was prepared and used as a reducing and chelating agent to synthesize the nanohybrid material by mixing it with molybdenum disulfide (MoS2) and ferric nitrate [Fe (NO3)3.9H2O], followed by heating and calcination. The X-ray diffraction (XRD) pattern confirms the formation of a nanohybrid consisting of monoclinic Fe2(MoO4)3, cubic Fe2.957O4, and orthorhombic FeS with 86% consisting of Fe2(MoO4)3. The properties were analyzed through Fourier-transformed infrared spectroscopy (FTIR), atomic force microscopy (AFM), scanning electron microscopy (SEM), and transmission electron microscopy (TEM). The results of the dynamic light scattering (DLS) study revealed a heterogeneous size distribution, with an average particle size of 48.42 nm for 18% of particles and 384.54 nm for 82% of particles. Additionally, the zeta potential was measured to be -18.88 mV, suggesting moderate stability. X-ray photoelectron spectroscopy (XPS) results confirmed the presence of both Fe2+ and Fe3+ oxidation states along with the presence of Molybdenum (Mo), oxygen (O), and Sulphur (S). The prepared nanohybrid material exhibited a band gap of 2.95 eV, and the photoluminescence intensity increased almost twice that of bare MoS2. The present work holds potential applications in photo luminescent nanoplatform for biomedical applications.