Herein, we report an eco-friendly and simple fluorescent nitrogen-doped carbon quantum dot (N-CQD) biosensor which was synthesized via a hydrothermal method using erhanediamine (EDA) and citric acid (CA) as precursors. The surface functionalization of N-CQDs exhibited a bright blue emission under the excitation wavelength of 350 nm. The obtained N-CQDs were characterized by atomic force microscopy (AFM), Fourier transform infrared spectroscopy, x-ray photoelectron spectroscopy, and transmission electron microscopy. It was found that the surface of the CQDs was successfully functionalized. After that, as-prepared N-CQDs were further applied in Fe(III) detection. Spectroscopic data indicated that fluorescent carbon-based nanomaterials displayed a sensitive response to Fe3+ in the range of 0.5–1000 μM as a fluorescence sensor in real environmental samples. Furthermore, the results also showed that a novel N-CQD nanomaterial could be employed as an ideal fluorescent Fe(III) probe.