Listeria monocytogenes, responsible for listeriosis, poses a high fatality rate of up to 30%, surpassing other foodborne illnesses. This pathogen contaminates various dairy products, including raw and pasteurized milk. The conventional detection method (ISO 11290-1:2017) for L. monocytogenes is labor-intensive, requiring 5-7 days. While rapid detection methods exist, they are often costly and require skilled personnel. Addressing these challenges, our study developed a practical, cost-effective assay for rapid L. monocytogenes detection in milk. The assay employs a highly specific enzyme–substrate reaction, yielding a green color on the strip when the L. monocytogenes-specific enzyme interacts with the loaded selective substrate. The initial optimization focused on parameters like time–temperature combinations and substrate volumes to achieve a low detection limit. The assay comprises two stages: first, the pre-enrichment of dairy samples in Listeria Selective Enrichment Media (LSEM) for 24 hours to recover injured cells, indicated by a black color, presumptively confirming the presence of Listeria spp. Subsequently, the enriched sample is applied to the strip-based assay, where green color development confirms the presence of L. monocytogenes. Detection takes just 9 hours, with a 24-hour enrichment step which is optional for highly contaminated samples. Out of 70 raw and pasteurized milk samples tested, the developed assay confirmed the presence of L. monocytogenes in one sample. The validation of the obtained results against the ISO method further supported the reliability of our study. This method’s 9-hour detection time contrasts sharply with ISO’s week-long confirmation process. Further optimization of our developed assay for other dairy products is necessary to expand its application in industry. The developed assay is a translation of our patented technology (Indian Patent No. 410633) and is a rapid, user-friendly, and economic advancement which enhances food safety in dairy processing.