Using an environmentally friendly chemical process, a novel nanocomposite consisting of reduced graphene oxide (rGO) and silver(I) oxide (Ag2O) nanoparticles was successfully synthesized in this work, and its optical properties along with photoelectric performance were investigated. Ag2O is a narrow-bandgap p-type semiconductor with strong visible light response but exhibits poor carrier separation and structural instability during exposure to radiation. In order to overcome shortcomings encountered with Ag2O, rGO was used as a conductive support to produce rGO@Ag2O nanocomposites with improved electronic interactions. Various characterization tests, including energy-dispersive X-ray spectroscopy (EDXS), field emission scanning electron microscopy (FESEM), Fourier-transform infrared spectroscopy (FTIR), and X-ray diffraction (XRD) spectroscopy, were adopted to analyze the morphological and structural features of the synthesized materials. The results confirmed that rGO, Ag, and Ag2O coexist in the hybrid structure where nanoparticles are uniformly dispersed. The optical properties were evaluated using photoluminescence (PL) and UV–Vis spectroscopy analyses. The findings showed that, compared to the pristine Ag2O and rGO, the rGO@Ag2O composite has a smaller optical band gap (5.73 eV), which allows for more efficient electron transfer. In current–voltage (J–V) measurements used to assess the photoelectric performance, the nanocomposite also showed a significantly higher current density, which was attributed to the synergistic effect of rGO and Ag2O enhancing charge transfer and separation. The addition of rGO reduced the recombination loss while also improved electron mobility and light absorption. Our findings show that rGO@AgO nanocomposites are promising as next-generation optoelectronic materials for photocatalytic systems, photodetectors, and solar energy harvesting. The green synthesis method supports the potential of this material for further scalable and sustainable technology integration.