SmCr0.85Mn0.15O3 (SCMO) nanoparticles with Pnma space group have been synthesized by the sol-gel auto-combustion method with an average crystallite size of 70 nm. The structural analysis indicates a comparable unit cell volume with that of the bulk compound. The structural distortion is calculated by various factors such as cell distortion factor, octahedral distortion, dodecahedral distortion, strain and tolerance factor, which arise due to the Jahn-Teller (JT) effect and a tilting in the octahedra. The obtained distortion values suggest a larger distortion in the structure due to the nano-size effect compared with the bulk counterpart. The diffuse reflectance spectrum confirms the semiconducting nature of SCMO nanoparticles with an optical bandgap of 2.9 eV, higher than that of the bulk compound. The extinction coefficient of the SCMO nanoparticles exhibits a larger value than that of the bulk, suggesting a higher absorbing character of the nanoparticles. The temperature-dependent magnetization reveals a decrease in the Néel temperature on Mn substitution. The negative magnetization is also observed below the compensation temperature, Tcomp. Moreover, a stable magnetic switching behavior is demonstrated by varying temperatures under ZFC and FC protocols. The semiconducting nature and the stable magnetic switching behavior of SCMO nanoparticles make them suitable for optoelectronic, photovoltaic, and magnetic switching applications.