The present research work explores the feasibility of a novel sensor based on nanostructured cotton threads. These threads were functionalized using carbon nanotubes (CNTs) and PAni/γ-Fe₂O₃ nanostructures. To begin with, we prepared catalyst nanoparticles by a hydrothermal method. These nanofabricated catalyst particles were used to grow CNTs by a newly designed catalytic chemical vapor deposition set up. The resulting CNTs were subjected to strategic purification steps. Both nanofabricated catalyst and decontaminated CNTs were analysed to study their size, shape, surface morphology and crystalline structure. Pure CNTs were successfully incorporated on permeable cotton threads using basic submersion in a CNT-ink under an ultrasound environment. These profoundly conductive cotton threads were functionalized using PAni/γ-Fe₂O₃ nanostructures by facile ultrasound assisted in situ polymerization. The hybrid nanostructured cotton threads were prepared at different loadings of both CNTs and PAni/γ-Fe₂O₃ nanocomposite and their influence was further investigated to study their surface morphology, electrical behavior and sensing performance for the detection of LPG. A quick response time and maximum response value (R_res = 0.91) were observed for low concentration (50 ppm) detection of LPG at ambient temperature. So these hybrid nanostructured cotton based sensing threads could be easily woven into the textile materials which will be useful as wearable gadgets for LPG detection in household kitchens, manufacturing sites and industries. Also this work will boost an essential encouragement for the development of wearable smart sensing gadgets.