A biopolymer based nanocomposite with O‐Carboxymethyl chitosan (O‐Cmc), nano zinc oxide (ZnO) and Lawsone (Ln) with proving advantages in antibacterial wound healing application was prepared. The physiochemical characteristics of the nanocomposite (NCs) was analysed by Fourier Transmission Infrared spectroscopy (FT‐IR), X‐Ray Diffractometer (XRD), Scanning electron Microscopy (SEM), Transmission electron microscope (TEM) and Thermogravimetric analysis (TGA). The biological properties such as anti‐inflammatory, anti‐oxidant activities were investigated in vitro. The nanocomposite also possesses efficient drug encapsulation and releasing profile with greater stability in phosphate buffer saline (PBS) and Dulbecco's minimal essential medium (DMEM). The results of the antibacterial studies show its enhanced bactericidal nature. The results obtained from MTT assay, Ethidium bromide stained fluorescence image and in vitro wound scratch assay show greater cell viability with the closure of scratch wound obviously proves it′s prominent biocompatible, wound closure nature. These biological properties show that the prepared nanocomposite has a greater potential to act as an excellent biomaterial in the field of wound care applications.