Nanostructured NiO thin films are renowned for their catalytic activity and potential for degradation of industrial effluents. In this study, Al-doped NiO (Ni1-xAlxO with x = 0, 0.02, 0.04, 0.06, and 0.08) thin films were synthesized by sol–gel spin coating, and the influence of Al doping on their physical properties, surface morphology, optical band gap, and photo-catalytic performance was investigated. X-ray diffraction (XRD) analysis confirmed the high crystallinity of the thin films and revealed a pronounced doping effect on parameters such as crystallite size, microstrain, and dislocation density. Scanning electron microscopy (SEM) revealed the formation of spherical nanoparticles with particle sizes ranging from 26 nm to 11 nm. The elemental composition was verified through energy-dispersive x-ray (EDX) analysis. The optical bandgap of the prepared films was determined through UV-visible spectroscopy. The Ni0.98Al0.02O films exhibited the lowest PL intensity, indicating a reduced recombination rate. To assess the photo-degradation capability of the prepared thin film catalysts, industrial effluent Indigo Carmine was employed as a test compound. The Ni0.98Al0.02O sample demonstrated the highest degradation efficiency, achieving about 96% degradation within 2 h of UV–vis light irradiation. Furthermore, the degradation followed pseudo-first-order kinetics.