An aminohydroxylated polyester fabric with durable antibacterial activity, enhanced hydrophilicity and improved mechanical properties was prepared in one single step process. In the proposed method, synthesis of silver nanoparticles was carried out along with the aminohydrolysis of polyester fabric using triethanolamine (TEA), acting as reducing and stabilizing agent. The morphology, crystal phase, and chemical structure of the fabrics were characterized by scanning electron microscope (SEM), X-ray diffraction (XRD) and energy dispersive X-ray spectroscopy (EDX). The tensile properties and water spreading times of the treated fabrics were also measured. Moreover, central composite design based on response surface methodology was applied to study the influence of silver nitrate and TEA concentrations. It was found that silver nanoparticles with an average crystal size of 17 nm were synthesized on the fabrics treated at 130 °C. The distribution of Ag nanoparticles on the fiber surface was confirmed by SEM and EDX. Interestingly, the tensile properties of the treated samples were enhanced in comparison with the untreated fabric. Findings suggest the potential of triethanolamine in the simultaneous aminohydrolysis of polyester fabric and reduction of silver ions into silver nanoparticles, preparing a fabric with excellent antibacterial efficiency against Staphylococcus aureus and Escherichia coli, higher tensile strength and improved hydrophilicity.