The synthesis of a combinatorial library of heterocycle-fused pyridine derivatives has been achieved successfully via a one-pot four-component reaction of aromatic/aliphatic aldehyde, malononitrile, thiazolidine-2,4-dione and ammonium acetate in the presence of piperidinium acetate as the catalyst. It involved the Knoevenagel condensation of the aldehyde and malononitrile to produce arylidene malononitrile as an intermediate, which was further intramolecular cyclization through Michael type addition ketone to the electrophilic double bond of the arylidene to produce fused pyridines in high yields. Environmental friendliness, low cost, Operational simplicity, extensive reusability and applicability, and easy recovery of the catalyst using simple evaporation are the critical features of this methodology. Also, a series of pyridine based dihydrothiazolo[4,5-b] pyridine-6-carbonitrile analogs were synthesized and selected for their in vitro antifungal and antibacterial activities.