Carbon quantum dot containing nitrogen has been prepared by utilizing a green biomass resource, Morinda coreia fruits, by a single step hydrothermal procedure. The spherical carbon dots are analysed by HR-TEM, XPS, FT-IR, UV–visible and photoluminescence studies. With a mean diameter of 1.99 nm, they possessed functional groups like carboxyl and amide on their surface and emit light of wavelength of 490 nm under 390nm excitation. The fluorescent Morinda coreia carbon dots (MCCDs), whose quantum yield is found to be 17.1 %, are very sensitive to the presence of iron (III) ions with a low detection limit of 1.32 μM. Successful fluorometric determination of Fe3+ ions from tap water and borewell water were also achieved with good recovery rates. Interactions between surface groups on MCCDs and Fe3+ ions lead to the formation of a non-fluorescent complex, and a static quenching mechanism is proposed.