Carbon quantum dots/polyaniline (CQDs/PANI) nanocomposite was successfully prepared by in-situ polymerization of aniline. CQDs were synthesized hydrothermally from gelatin with a diameter size of 4.2 nm and a 17% quantum yield. FTIR, UV-vis absorption, fluorescence spectrophotometer, XRD, TEM, XPS and lifetime decay were used to characterize the obtained nanocomposite. The formation of PANI revealed a high quenching effect on CQDs where the TEM images showed that the formed CQDs were greatly embedded in PANI matrix. In this study, CQDs/PANI nanocomposite was used for the detection of picric acid (PA) in the range 0.37-1.42 μM with a low detection limit (LOD) of 0.056 μM. The prepared sensor showed good enhancement and sensitivity towards PA in comparison to pristine CQDs and other nanostructured materials. The mechanism of PA detection has been studied where it was observed that PA is electrostatically interacted to the nanocomposite through - OH group of PA and the protonated PANI salt formed in CQDs/PANI nanocomposite by fluorescence resonance energy transfer applications. The proposed CQDs/PANI sensor was then utilized in real water samples and successfully determined the different amounts of PA spiked into tap water.