The innovative nanocomposites (NCs) of antibacterial and antitumor 2-amino-5-S-benzyl-1, 3, 4-thiadiazole (ABMT): binary (NC₁): ABMT-clay as well as the ternary (NC₂): ABMT-clay-chitosan have been prepared following the top-down approach method. The ABMT molecules have been efficiently uploaded on the inorganic polymer potassium montmorlinite clay polymer (MMT). The NC is homogenously dispersed in the aqueous solutions without crystallization of ABMT. However, the dispersity of the small particle size and the crystallinity of NC₁ is greatly enhanced in the presence of the biopolymer chitosan. The nanocomposites showed good non linear optical activity with suitable band gaps indicated the electron confinement in the NC. The loading and entrapment efficiency of ABMT onto MMT reached 89.3% in NC₁ during 6 h of contact time with the aqueous solution of pH 6.8. The enhanced redox characteristics of NC₁ relative to that of MMT suggested the better biological (antibacterial and antitumor) activity of NC₁. Chitosan enhanced the redox and the optical properties of NC₁ and its ability to undergo intercharge transfer to any acceptor sites. Hence, chitosan may added synergestic electron donation and, hence antitumor activity to the binary NC₁.