The aim of the present research work was to develop halogen and formaldehyde-free, durable flame retardant fabric along with multifunctional properties and to find the optimal conditions and parameters. In this research, zinc oxide nanoparticles (ZnO NPs) were grown onto 100% cotton fabric using the sonochemical method. Zinc acetate dihydrate (Zn(CH3COO)2·2H2O) and sodium hydroxide (NaOH) were used as precursors. After ZnO NPs growth, N-Methylol dimethylphosphonopropionamide (MDPA) flame retardant was applied in the presence of 1, 2, 3, 4-butanetetracarboxylic acid (BTCA) as cross-linkers using the conventional pad–dry–cure method. Induced coupled plasma atomic emission spectroscopy (ICP-AES) was used to determine the deposited amount of Zn and phosphorous (P) contents. Scanning electron microscopy (SEM), X-ray powder diffraction (XRD), and Fourier-transform infrared spectroscopy (FTIR) were employed to determine the surface morphology and characterization of the developed samples. Furthermore, the thermal degradation of the untreated and treated samples was investigated by thermogravimetric analysis (TGA). Furthermore, the vertical flame retardant test, limiting oxygen index (LOI), ultraviolet protection factor (UPF), and antibacterial activity of samples were examined. The developed samples showed excellent results for flame retardancy (i.e., 39 mm char length, 0 s after flame time, 0 s after glow time), 32.2 LOI, 143.76 UPF, and 100% antibacterial activity.