Microbial fuel cells (MFCs) are widely used for wastewater treatment and energy production. They are outfitted with nickel foam electrodes that have been modified by conducting polymer polypyrrole, as well as metal nanoparticles. Notwithstanding these developments, the actual application of MFCs with modified nickel foam anodes is still constrained in terms of power output and significant treatment of wastewater. To achieve higher power and current densities, we developed an environmentally friendly, durable, and adhesive polypyrrole-Mo2O3 composite on nickel foam (PPy-Mo2O3/NF). The composite anode had a huge surface area and a 3D porous structure, which allowed microorganisms to attach and grow, according to SEM investigations. Additionally, this arrangement speeds up the flow of electrolyte ions in the diffusion layer and improves electron transmission. The nanocomposite-based anode’s favorable properties significantly enhance COD removal. An MFC equipped with a PPy-Mo2O3/NF composite anode achieved a power density of 53.89 ± 0.97 mW/m3 and a current density of 83.40 ± 0.90 mA/m2, both of which were substantially higher compared to an MFC with a bare NF anode. Additionally, it removed 80.39% of COD, demonstrating outstanding performance. The improved composite anode’s superior biocompatibility and selectively enhanced electrogenic bacteria were verified by high-throughput sequencing. This work emphasizes a straightforward and eco-friendly approach to anode modification utilizing the PPy-Mo2O3 composite, which results in increased power density and better wastewater treatment efficiency.