A new ternary nanocomposite comprising nickel oxide (NiO) embedded into a binary polymeric network of polyaniline (PANI) and polypyrrole (PPy), i.e. PANI‐PPy‐NiO, is synthesized using an in situ chemical oxidative method. The infrared spectrum of PANI‐PPy‐NiO exhibits most of the characteristic peaks of unary nanoparticles with slight shift in the frequencies. The shift is due to the synergistic interaction of binary PANI‐PPy with the inorganic NiO nanoparticles. X‐ray diffraction pattern reveals the semicrystalline structure of the PANI‐PPy‐NiO nanocomposite with an average crystallite size of 22 nm. From Williamson–Hall plot, the micro‐strain value of as‐prepared PANI‐PPy‐NiO is found to be −0.16727. Surface morphology of PANI‐PPy‐NiO shows fine grains of NiO‐encapsulated PANI‐PPy that tend to coalesce and form an agglomeration assembly. The elements detected from energy‐dispersive X‐ray analysis indicate the purity of synthesis of the ternary material. Further, the optical constants obtained from UV–visible spectra (absorption coefficient, extinction coefficient, refractive index, optical conductivity and real and imaginary dielectric constants) are found to be higher for PANI‐PPy‐NiO than for the unary PANI, PPy and NiO nanoparticles. Tauc plot and Urbach energy studies indicate the low bandgap energy of PANI‐PPy‐NiO (2.67 eV) compared to unary nanoparticles. Further, the emission intensity peak (492 nm) observed in the photoluminescence spectrum of PANI‐PPy‐NiO corresponds to the blue region of the visible spectrum. Thus, the optical studies clearly indicate the high suitability of the synthesized PANI‐PPy‐NiO in visible‐light‐based device applications. © 2022 Society of Industrial Chemistry.