ABSTRACTThe detection of brain tumours presents a significant challenge in the medical domain, where prompt and precise diagnosis is crucial as patient outcomes depend on it. Conventional deep neural networks perform well in carrying out various imaging tasks within the healthcare sector; however, their effectiveness often falls short of expectations in practical applications due to the substantial computational resources required and issues with reliability. In this research, an optimised and effective deep learning model founded on the DenseNet‐169 architecture is introduced for the classification of magnetic resonance imaging brain tumours, which is particularly advantageous for smart healthcare systems and information and communication technology (ICT) settings with limited computational capabilities. The model compression methodologies, including pruning and quantization, have been employed to significantly diminish the dimensions and intricacy of the model while achieving a classification accuracy of 97.07%. Furthermore, this endeavour necessitates the enhancement of the model's interpretability through the utilisation of explainable artificial intelligence methodologies such as Gradient‐weighted Class Activation Mapping (Grad‐CAM) and SHapley Additive exPlanations (SHAP), which will aid clinicians in highlighting crucial areas of the images and validating feature importance concerning the decisions rendered by the model. A comparative performance evaluation is conducted against DenseNet‐169, ResNet‐50 and various other models to delineate the superior efficacy of our model, rendering it exceptionally adept for knowledge‐driven, real‐time brain tumour diagnosis within smart healthcare and ICT systems where resources are constrained.