In this paper, a high-performance ethanol sensor based on iron (Fe)-doped titanium dioxide (TiO)/molybdenum disulfide (MoS) nanocomposite was demonstrated. Flower-like MoS and Fe-TiO quantum dots (QDs) were synthesized by a facile hydrothermal route, and the Fe-TiO/MoS composite was prepared via layer-by-layer (LbL) self-assembly technique. The Fe-TiO/MoS film sensor was fabricated on a flame resistant (FR-4) epoxy substrate with interdigital electrodes. The microstructure, elementary composition, and morphology of the as-prepared samples were fully characterized by X-ray diffraction (XRD), energy dispersive spectroscopy (EDS), scanning electron microscopy (SEM), transmission electron microscope (TEM), and X-ray photoelectron spectroscopy (XPS). The gas sensing properties of the Fe-TiO/MoS film sensor were determined at room temperature upon exposure to different concentration of ethanol gas. The experimental results illustrated that high response, short response/recovery time, stable repeatability, excellent selectivity long-term stability, and a detection limit of low ppb level was achieved by the Fe-TiO/MoS sensor. The underlying sensing mechanism of the Fe-TiO/MoS sensor toward ethanol is explored through systematically experimental investigation combining with first-principle density-functional theory (DFT) simulations. The enhanced ethanol sensing properties were ascribed to the Fe ion doping, and p-n heterojunctions created at interfaces of n-type Fe-TiO and p-type MoS.