A one-pot synthesis method is utilized for the fabrication of ultrasmall platinum-silver nanoparticles decorated on graphene (PtAg/G) catalyst. This method has several advantages such as inexpensiveness, simplicity, low temperature, surfactant free, reductant free, being environmentally friendly and greenness. In this work, graphene and silver formate were dispersed in ultrapure water in an ultrasonic bath at 25 °C followed by through a galvanic displacement reaction; to prepare PtAg/G, PtCl2 was added to the suspension under mild stirring condition. The morphology, crystal structure and chemical compositions of the as-fabricated PtAg/G and Pt/C catalysts were characterized by transmission electron microscopy (TEM), X-ray diffraction (XRD) and Energy dispersive X-ray spectroscopy (EDS) techniques. Electrochemical techniques, including cyclic voltammetry (CV) and chronoamperometry (CA) measurements were used to analyze the electrochemical activity of the PtAg/G and Pt/C catalysts. The TEM images illustrate the uniform distribution of ultrasmall PtAg nanoparticles with the average size of 2–3 nm on the graphene nanosheets. The PtAg/G promoted the current density 2.46 times as much as Pt/C with a negative shift in onset oxidation potential and peak potential for oxidation reaction of methanol. Besides, the novel PtAg/G catalyst shows large electrochemically active surface area, lower apparent activation energy, and higher levels of durability in comparison to the Pt/C catalyst for the oxidation of methanol. The PtAg/G catalyst depicts extraordinary catalytic performance and stability to those of the Pt/C catalyst toward methanol oxidation in alkaline media.