Here, a highly efficient CO sensing system was developed by preparing novel hybrid nanocomposite structure using RGO sheets and CuO nanoparticles. The RGO sheets used in this sensor were prepared by using modified Hummer’s method, whereas CuO nanoparticles were prepared by employing a precise chemical synthesis process. The performance of the system was rigorously tested at 0.5 ppm concentration of the CO gas under standard laboratory conditions to evaluate its sensing characteristics. The sensor demonstrated high sensitivity with a change of about 38% at a concentration of 0.5 ppm. The sensor response/recovery time was observed to be 1.5 s–4.5 s, respectively, indicating its ability to detect low levels of CO gas effectively. The stability of the device was perfect where the sensing performance was checked repeatedly for 30 days. The selectivity of the sensor was also very good which was tested with different interfering gases. Therefore, it may be concluded that the prepared sensor possesses significant characteristics for the reliable monitoring of CO gas at a lower concentration, which is crucial for improving safety in sewer systems, as well as in other locations where an early detection of this gas can play a vital role in preventing accidents and protecting both human lives and infrastructure.