Trivalent chromium ions are the abundant toxic metal, released to environment by various industrial effluent discharges. A sensitive and specific SPR technique for Cr(III) detection in trace levels from aqueous sample was developed in the present study. Here, Ag decorated Au nanoparticles (NPs) was functionalized with citrate by chemical-reduction technique. The Ag–Au NPs probe was analyzed via UV–visible spectrophotometer, TEM, EDAX, FTIR, DLS, and zetasizer. The Ag–Au NPs zeta potential was −36.66 mV and the particle size was 19 nm. The developed probe shown drastic variation in colour from dark pink to colourless with response time of 60 s after the interaction with Cr(III) ions. The absorbance at A526 showed good linearity with Cr(III) concentrations (10 nM - 100 µM). The LOD of Ag–Au NPs probe for Cr(III) detection was found to be 0.4 nM. The Ag–Au NPs sensor showed high specificity towards Cr(III) ions even in presence with competitive metal ions. In acidic pH and at temperature range of 25–50 °C the probe worked effectively. At last, the fabricated probe was applied for Cr(III) ion estimation in Cr(III) augmented environmental samples and the detection accuracy was determined by comparing with atomic absorption spectrophotometric analysis. Thus, the reported suggest that Ag–Au NPs could be applied for the selective detection of Cr(III) from environmental samples with excellent accuracy.