This study developed a MgBi2O6-based photocatalyst via low-temperature hydrothermal synthesis. AgBr was co-precipitated onto MgBi2O6, and silver nanoparticles (AgNPs) were photo-reduced onto the surface. The photocatalytic performance, assessed by methylene blue (MB) degradation under white-light LED irradiation (2.5 W, power density = 0.38 W/cm2), showed that Ag/AgBr/MgBi2O6 achieved 98.6% degradation in 40 min, outperforming MgBi2O6 (37.5%) and AgBr/MgBi2O6 (85.5%). AgNPs boosted electron-hole separation via surface plasmon resonance, reducing recombination. A Z-scheme photocatalytic mechanism was suggested, where photogenerated carriers transferred across the p–n heterojunction between AgBr and MgBi2O6, producing reactive oxygen species like superoxide and hydroxyl radicals critical for dye degradation. Thus, the Ag/AgBr/MgBi2O6 composites possessed excellent photocatalytic performance regarding dyestuff degradation (85.8–99.9% degradation within 40 min) under white-light LED irradiation.