Nanomaterials offer a wide range of applications in environmental nanotechnology. Hazardous pollutants in the environment are needed to be detected and controlled effectively to avoid human health risks. In this paper, we described the fine-controlled growth of In2O3 nanoparticles embedded on GO nanosheets by a facile precipitation method. The In2O3@GO nanocomposites exhibited outstanding gas sensing performance as compared with pure In2O3 nanoparticles towards NO2. At 225 °C, the sensor displayed high selectivity, best response (78) to 40 ppm NO2, quick response, and recovery times of 106s/42s. The improved sensing performances of the nanocomposite were attributed to large surface area, high gas adsorption-desorption capability, and the formation of p-n heterojunctions between In2O3 nanoparticles and GO nanosheets. The excellent gas detecting activities validate In2O3@GO nanocomposites as a promising candidate in the NO2 gas sensor industry.