AbstractThe search for cost‐effective and efficient counter electrode finds its way in choosing vanadium pentoxide, an abundant and low‐cost material with good electrocatalytic property and stability. Two‐dimensional vanadium pentoxide nanosheets (V2O5 NS) were prepared by a simple hydrothermal method followed by calcination at 350 °C. The morphology of the synthesized material provides an excellent surface property with good surface area and a wide range of porosity distribution helps in enhancing the electrocatalytic active sites for effective reduction of I3−. The electrochemical studies performed with V2O5 NS showed good electrocatalytic activity with high current density, low series and charge transfer resistance. The electrochemical techniques CV, EIS and Tafel polarization performed with V2O5 NS gave an enhanced electrocatalytic activity and charge transfer kinetics with a low value of Rs and Rct. Furthermore, the photocurrent voltage studies done with V2O5 NS CE DSSC achieved a PCE of 5.1% ( Open circuit voltage (Voc)=0.65 V, short ciruit photocurrent density (Jsc)=11.67 mA/cm2 and fill factor (FF)=66.46%) and the conventional thermal decomposed Pt CE DSSC reached the PCE of 7.4% (Open circuit voltage (Voc)=0.78 V, short circuit photocurrent density (Jsc)=15.03 mA/cm2 and fill factor (FF)=57.39%) under similar test conditions, appreciably good performance than previous reports on V2O5 CE DSSC. The present work encourages further extensive research to develop nanostructures of V2O5 as a low‐cost alternate counter electrode to Pt CE for large‐scale production.