Carbon monoxide (CO) is a colorless, odorless, and toxic gas that requires effective detection due to health risks upon exposure. Carbon dots (CDs), due to their size and surface properties, are used in gas sensing applications especially when functionalized through heteroatom doping. In this study, N-doped carbon dots derived from water hyacinth were synthesized through ultrasound-assisted solvothermal carbonization. A Box–Behnken design under Response Surface Methodology was employed to obtain optimal synthesis conditions for maximum quantum yield, with optimal parameters identified as 177°C, 6.25 hours, and 2.62 g dopant amount achieving a quantum yield of 20.15%. UV–vis and PL analysis confirmed nitrogen doping with peaks at 272 nm and 394 nm, corresponding to electron transitions, and stable excitation-independent emission at 483 nm, respectively. FTIR analysis confirmed surface functional groups such as O–H, N–H, C–H, C–N, and C–OH. FESEM-EDX analysis revealed spherical to quasi-spherical morphology with size ranging between 8 to 55 nm and confirmed the presence of carbon, nitrogen, and oxygen. Gas sensing was performed in a fabricated setup comprising a sealed chamber, CO and N₂ cylinders, and temperature and mass-flow controllers and were regulated at the set parameters. Results showed that the N-doped water hyacinth CDs exhibited higher gas response than undoped CDs in all tested concentrations and temperatures, attributed to improved charge transfer and increased active adsorption sites from doping. Statistical analysis also confirmed that CO concentration and temperature had significant and independent effects on sensor performance. This study demonstrated the potential of N-doped CDs in CO sensing at lower concentrations.