Cerium oxide nanoparticles have so far been investigated for their role as an antioxidant in pathologies involving inflammation and high oxidative stress. However, its role as a plant and bacterial growth modulator and heavy metal stress reliever has been overlooked to date. Heavy metal contamination poses a major threat to mankind and the life-sustaining ecosystem. This study emphasizes the role of cerium oxide produced by the combustion method in promoting growth in Vigna radiata and Bacillus coagulans in the presence of mercury. The results show that cerium oxide nanoparticles significantly reduce the production of reactive oxygen species, hydrogen peroxide, and product of lipid peroxidation malondialdehyde in plants grown in the presence of 50 ppm mercury, thereby reducing oxidative stress. Nanoceria also increases plant growth with respect to those growing solely in mercury. Nanoceria alone does not significantly affect the growth of Vigna radiata as well as Bacillus coagulans and Escherichia coli, thereby proving its non-hazardous nature. It also significantly increases the growth of Bacillus coagulans at 25 ppm and 50 ppm of mercury. This study throws light upon the biologically non-hazardous nature of this particle by revealing how it promotes the growth of two soil bacteria Bacillus coagulans and E.coli at various dosages. The results of this study pave the way for the use of cerium oxide nanoparticles in plants and various other organisms to combat abiotic stress.