Nowadays growing concerns are rising toward water contamination caused by pharmaceuticals. Consequently, the design of optical sensors for their detection and analysis is extremely essential. In the current work, iron (III) aminoterephthalate-based metal-organic framework (Fe(III)-MOF) was synthesized by two approaches i.e. conventional and ultrasonication without the use of any organic solvents. Calcination of the synthesized Fe(III)-MOFs resulted in formation of different iron oxide phases i.e. magnetite and hematite depending on the calcination conditions. Magnetite NPs obtained from calcination of conventionally prepared MOF were efficiently utilized in the removal of daclatasvir (DAC), a hepatitis C antiviral drug, from water. Adsorption mechanism was investigated, and it was found that electrostatic interaction is the main force governing the adsorption of DAC on the magnetite NPs surface. Moreover, adsorption kinetics was studied, and it was established that adsorption of DAC on magnetite NPs surface follows pseudo-second order kinetics with R² = 0.9970. The removal efficiency reached 99.9% after 220 min while using 5.0 mg/L of DAC. Furthermore, conventionally prepared Fe(III)-MOF showed higher fluorescence signal than ultrasonically-prepared MOF (∼3.0 times). This finding was exploited for utilization of conventionally prepared Fe(III)-MOF as a highly sensitive “turn-off” fluorescent probe for the analysis of nifuroxazide (NIFR) in domestic water. Parameters affecting sensing properties such as pH, solvent type and concentration of Fe(III)-MOF were optimized. The highest fluorescence quenching efficiency of NIFR was achieved while using 50 mg/L of Fe(III)-MOF in pH 9.0. Inner-filter effect was verified experimentally and mathematically to be the principal mechanism of the fluorescence quenching. The developed strategy showed high selectivity and sensitivity towards the analysis of NIFR with limit of detection and quantitation of 8.0 and 25.0 μg/L, respectively. Moreover, the designed sensor was successfully applied for determination of NIFR in domestic water without any interference from other tested antiviral, antidiabetic or antimicrobial drugs.