Cerium doped zinc oxide (CZO) nanomaterials have been synthesized by the sol–gel combustion method. The effect of Ce doping (up to 5 mol%) on the structural, morphological, optical and photoluminescence properties has been investigated and the applications of CZO in photocatalytic and antibacterial studies were also assessed. X-ray diffraction analysis revealed that the CZO nanomaterials have the hexagonal wurtzite structure. The maximum crystallite size of 84 nm was obtained for the 1 mol% Ce doped nanomaterial. The morphology of the CZO powder was gradually affected by the Ce doping concentration. Element mapping using energy dispersive X-ray spectroscopy showed the uniform distribution of Ce atoms in the ZnO, but higher resolution nano-scanning Auger microscopy measurements revealed enhanced Ce concentration in nanoparticles occurring in the doped material. The absorption spectra were calculated from reflection measurements using the Kubelka-Munk function and showed strong absorbance below 410 nm. The optical bandgap slightly varied around 3.20 eV for the different Ce doping concentrations. Photoluminescence consisted of a broad emission band centered at 635 nm having a clear blue shift as the Ce concentration increased. A photocatalytic study was done by means of methylene blue as a dye in UV light. The doped oxide is also an antibacterial/antifungal agent and its efficiency has been measured against bacteria (Staphylococcus aureus and Escherichia coli) and yeasts (Eremothecium ashbyii and Nadsonia fulvescens).