This study explores the use of green TiO2/Fe nanocomposite for surface modification of cotton fabric, aiming to minimize its limitations such as wrinkle, shrinkage, lower photocatalytic activity, microbial degradation, and poor durability. To prepare the nanocomposite, the iron (Fe) and titanium dioxide (TiO2) nanoparticles were first green synthesized using an extract of guava leaf (Psidium guajava) and mixed by using citric acid as a cross-linking agent. The modified cotton fabric was characterized by FTIR, TGA, DTG, SEM, and EDS. The FTIR spectra of the modified fabrics showed additional peaks at 483 cm−1 for Ti-O- and 1059 cm−1 for Fe-O-, indicating the incorporation of TiO2/Fe- nanoparticles which was also confirmed by SEM images. Fe nanoparticles enhanced TiO2 NPs’ photocatalytic activity, enhancing self-cleaning, UV resistance, stain resistance, anti-water absorption, and antibacterial activity in modified cotton fabric. Additionally, the wettability, thermal stability, mechanical and chemical stability of modified cotton fabric were also improved. As a result, the method of surface modification has great potential to improve the sustainability and usability of cotton fabric, supporting its wide range of uses in clothing, medical, and personal hygiene goods.