In the present study, ZnO nanostructures have been successfully synthesized by hydrothermal, sonochemical and precipitation methods using polyvinyl pyrrolidone (PVP) as the capping agent. The ZnO nanoparticles were characterized by X-ray diffraction (XRD), field emission scanning electron microscopy (FESEM), UV-Visible spectroscopy and photoluminescence (PL) techniques. The XRD results revealed the hexagonal wurtzite structure of the ZnO nanostructures for all the samples. Furthermore, the morphology of the ZnO particles was obtained from FESEM micrographs. Particles prepared by hydrothermal method were found to be rice grain shaped and that prepared by precipitation and sonochemical methods were spherical shaped. Sunlight driven photocatalytic degradation of methylene blue (MB) was studied for ZnO nanostructures synthesized by various methods. The ZnO nanostructures were further decorated with Ag nanoparticles to enhance its dye degradation efficiency. The Ag decorated ZnO nanoparticles exhibited a higher degradation rate as compared to pure ZnO nanoparticles which was independent of pH. Since this process of dye degradation relies on the degradation of dye due to oxidation by highly reactive hydroxyl radicals, there are many factors which affect the efficiency of this process. Hence a study was conducted on the effect of various parameters on ZnO viz amount of catalyst, reaction pH and concentration of MB dye.