ZnO–Eu2O3 nanocomposite was fabricated by a simple hydrothermal route. This material forms a potential class of photocatalysts in which the increased absorption behaviour in ZnO–Eu2O3 is expected to couple with the existing characteristics of Eu2O3 and ZnO materials. ZnO–Eu2O3 was characterized using surface analytical (SEM, EDS, HR-TEM, AFM, XRD) and spectroscopic techniques (XPS, DRS,PL). From the XRD patterns, formation of well-crystallized cubic Eu2O3 and hexagonal wurtzite phase of ZnO were inferred. Presence of nanoflake like structure with hexagonal ZnO and cubical Eu2O3 is shown by SEM pictures. ZnO–Eu2O3 possesses higher UV and visible absorption than Eu2O3 and ZnO. ZnO–Eu2O3 produces larger methanol oxidation current indicating its anodic catalytic efficiency in direct methanol fuel cells (DMFCs). This reveals higher electrocatalytic activity of ZnO–Eu2O3 than ZnO. It is observed that at −1.6 V, cathodic current density (ipc) of ZnO–Eu2O3 (−103.17 mA cm−2) for Hydrogen evolution reaction (HER) is more than five times of ZnO (−18.19 mA cm−2) and the hydrogen evolved with ZnO–Eu2O3is 15.6 mL, which is higher than that of ZnO (6.8 mL). This indicates the superior catalytic property of ZnO–Eu2O3 in water splitting. This catalyst exhibited higher catalytic activity of 99.2% in the photodegradation of Rhodamine B (Rh-B) with natural sunlight in 75 min under neutral pH, whereas Eu2O3 and ZnO produced 60 and 82% degradations in the same time. Degradation quantum efficiency by ZnO–Eu2O3 is larger than ZnO and Eu2O3. ZnO–Eu2O3 was stable and reusable. The multifunctionality of this catalyst makes it suitable for energy and environmental applications. © 2020 Elsevier B.V.