The abundance of dragon fruit peel (DFP) has led to increased focus on its use for value-added purposes. This work presents a simple one-pot hydrothermal method to synthesize efficient biochar adsorbent and fluorescent carbon quantum dots (CQDs) from DFP. The hydrothermal process yields a solid biochar adsorbent and a liquid CQDs solution. The resulting DFP-derived biochar boasts a specific surface area of 138.04 m2 g-1, a mean pore diameter of 3.68 nm, and a negatively charged surface, suggesting its efficacy in adsorbing cationic dyes, such as neutral red (NR) and methyl violet (MV), as demonstrated in this study. The obtained CQDs have sizes ranging from 3-6 nm, good water dispersibility, and bright and tunable fluorescence. Additionally, the CQDs display exceptional fluorescence quenching properties towards Fe3+, demonstrating their potential as a sensing material for Fe3+ with a remarkable limit of detection of 1.13 mu M and a wide linear range of 0-285 mu M. The CQDs also show low cytotoxicity and efficient cellular uptake capabilities, suggesting potential applications in cell imaging and Fe3+ detection within cells. Overall, this study presents a promising approach for utilizing DFP byproduct due to its simple synthesis process and the exceptional characteristics of the resulting adsorbents and CQDs.