Functionalized hydrogels, with their unique and adaptable structures, have attracted significant attention in materials and biomaterials research. Fluorescent hydrogels are particularly noteworthy for their sensing capabilities and ability to mimic cellular matrices, facilitating cell infiltration and tracking of drug delivery. Structural elucidation of hydrogels is crucial for understanding their responses to stimuli such as the pH, temperature, and solvents. This study developed a fluorescent hydrogel by functionalizing chitosan with p-cresol-based quinazolinone aldehyde. Confocal microscopy revealed the hydrogel's intriguing fluorogenic properties. The hydrogel exhibited enhanced fluorescence and a tunable network morphology, influenced by the THF−water ratio. The study investigated the control of gel network reformation in different media and analyzed the fluorescence responses and structural changes of the sugar backbone and fluorophore. Proper selection of mixed solvents is essential for optimizing the hydrogel as a fluorescence probe for bioimaging. This hydrogel demonstrated greater swelling properties, making it highly suitable for drug delivery applications.