Infectious diabetic wounds present a substantial challenge, characterized by inflammation, infection, and delayed wound healing, leading to elevated morbidity and mortality rates. In this work, we developed a multifunctional lipid nanoemulsion containing quercetin, chlorine e6, and rosemary oil (QCRLNEs) for dual anti-inflammatory and antibacterial photodynamic therapy (APDT) for treating infectious diabetic wounds. The QCRLNEs exhibited spherical morphology with a size of 51 nm with enhanced encapsulation efficiency, skin permeation, and localized delivery at the infected wound site. QCRLNEs with NIR irradiation have shown excellent wound closure and antimicrobial properties in vitro, mitigating the nonselective cytotoxic behavior of PDT. Also, excellent biocompatibility and anti-inflammatory and wound healing responses were observed in zebrafish models. The infected wound healing properties in S. aureus-infected diabetic rat models indicated re-epithelization and collagen deposition with no signs of inflammation. This multifaceted approach using QCRLNEs with NIR irradiation holds great promise for effectively combating oxidative stress and bacterial infections commonly associated with infected diabetic wounds, facilitating enhanced wound healing and improved clinical outcomes.