Ordinary casting technique has been used to fabricate the intrinsic films of polyvinyl alcohol (PVA) and polyvinyl pyrrolidone (PVP) polymer blend matrix incorporated with dissimilar weight percent contents of Fe:NiO nanocomposite (NC). X-ray diffraction (XRD) and infrared (IR) spectroscopy has been implemented to analyze NC structure of these films. Significant interaction and tuning of PVA/PVP blend matrix due to Fe:NiO NC is detected. XRD pattern reflects the structural modification and partial crystalline nature of the pristine blend matrix. The corresponding peaks of Fourier transform IR identifies the vibrational group of the synthesized samples. Atomic force microscope images indicate that a change in the Fe:NiO concentration in a pristine blend leads to an increase in the roughness and clusters. Numerous optical factors such as Eg (transition band gap), refractive index (n), and Eed (absorption edge) of pure blend and blend films with different concentrations of Fe:NiO were assessed via UV–Vis optical absorption spectra. As we increased the doping concentration in pristine blends, the value of Eg goes to decrease. The dispersion (Ed) and oscillator (Eo) energies were calculated from Wemple and Di. Domenico of a single oscillator. Although, optical susceptibilities and nonlinear refractive index were enhanced by doping with Fe:NiO NC. The change in doping content leads to modifications in the optical limiting. The photocurrent density–voltage properties of the present polymers were studied at different values of white light intensity. It was found that the photoconductivity of the PVA/PVP blend is 1.03275 × 10−8 (Ω cm)−1 , while NC films varied in the range (1.03–10.6954) × 10−8 (Ω cm)−1 at 8600 lux. In addition, the photosensitivity increased from 13.82 to 24.08. The recombination process was found monomolecular process for pure and doped polymers. The present films assume the possibility of their uses in optical and photo-electric devices.