An economic, eco-friendly and efficient synthesis route for Zinc oxide (ZnO) nanoparticles (NPs) using fungus has been explored along with the single-step impregnation of these nanoparticles on cellulose fibers. The transmission electron microscopy confirmed 50 nm as an average size of ZnO NPs and showed the presence of hexagonal phases. ZnO NPs-cellulose composite was fabricated by amending sugarcane bagasse-extracted cellulose in the reaction mixture during the nanoparticle synthesis. The composite was characterized using Fourier transform infrared, X-ray diffraction patterns, Scanning electron microscopy, and Energy dispersive spectroscopy, thermogravimetric analysis, and also evaluated for its antimicrobial potential. The analyses revealed that well-dispersed hexagonal wurtzite ZnO NPs were present on the surface of the cellulose fibers. ZnO NPs-cellulose demonstrated antibacterial activity against and , and antifungal activity against , and Thus, the study demonstrated an environmental friendly synthesis of ZnO NPs-cellulose composite using an economic and efficient method, which can be used for developing antimicrobial cellulosic fabric for numerous applications.