Hematite (α-Fe2O3) and its composites have garnered significant interest due to their outstanding features, making them promising candidates for a wide range of applications in photocatalysis, water splitting, gas sensing, and antibacterial fields. This study describes the synthesis of hematite and reduced graphene oxide (rGO) nanocomposites via a facile hydrothermal method, producing three samples using 0.018 g (FG1), 0.036 g (FG2), and 0.072 g (FG3) of graphene oxide (GO). The prepared nanopowders were subjected to versatile characterizations for studying their morphological, structural, optical, and magnetic characteristics. The growth of the rhombohedral structure of hematite was confirmed by analyzing X-ray diffraction patterns, and the production of nanocomposites was verified by Raman and infrared spectroscopy. According to electron microscope images, increasing the content of GO in the precursor solution caused the change of the morphology from large rhombus and cubic shapes with sizes of about 180 nm to worm-like nanoparticles with a length of about 90 nm and a mean diameter of 25 nm. The magnetic hysteresis loops of the composite samples reflect their ferromagnetic characteristics, with saturation magnetization (Ms) values of 0.02235, 0.14990, and 0.0608 emu/g for FG1, FG2, and FG3 samples, respectively. Lastly, the antibacterial activity of the nanocomposites was screened against both Staphylococcus aureus (Gram-positive) and Escherichia coli (Gram-negative) bacteria, and the results indicated that the growth of both bacterial strains was inhibited by all synthesized nanoparticles.