Several reports are available on aggregation-induced emission and its applications in biomedical imaging and other material sciences. However, enhancement of singlet oxygen generation in nanoaggregates is rarely reported. Here, we report the synthesis of Naph-BODIPY Br2, which absorbs at 661 nm (monomer) with a high molar absorption coefficient. The presence of bromine promotes intersystem crossing, thereby enhancing the singlet oxygen quantum yield (ΦΔ ∼ 0.50 in methanol). In order to increase hydrophilicity, we developed Naph-BODIPY Br2 nanoaggregates (∼100 nm), which demonstrated aggregation-induced properties and exhibited a bathochromic shift with an absorption maximum at 757 nm. The bathochromic shift in the UV-vis spectra due to aggregation is corroborated by TD-DFT analysis. The computational data also confirm the presence of a low-lying triplet state, which enhances the generation of singlet oxygen, making it effective for photodynamic therapy. These aggregates showed excellent singlet oxygen generation in aqueous media, compared to their monomeric form and standard methylene blue. Their hydrophilic nature and high singlet oxygen generation enabled significant phototoxicity against human carcinoma cells with IC50 values of 4.06 ± 0.01 and 4.09 ± 0.1 μM, respectively, for MCF-7 and A549 cells upon 5 min exposure to light. Moreover, their phototoxicity further increases with an increasing exposure time of light for both cell lines. Notably, Naph-BODIPY Br2 nanoaggregates exhibited nearly zero dark cell toxicity and effectively induced apoptosis in cancer cells upon light activation, highlighting their potential as powerful photosensitizers for photodynamic cancer therapy.