Two-dimensional molybdenum disulphide (MoS2) sheets were prepared by using simple thermal decomposition method. The synthesized sheets were characterized by different analytical tools including FTIR, XRD, XPS, Raman spectroscopy, HRTEM and FESEM analyses. The synthesized sheets exhibited outstanding peroxidase mimicking activity towards the peroxidase oxidation of chromogenic probe molecule 3,3′,5,5′-tetramethyl benzidine (TMB), producing a blue coloured solution of 3,3′,5,5′-tetramethylbenzidine diimine (TMBDI) in an acidic medium (pH 4). Based on this peroxidase mimicking activity it was utilized for colorimetric determination of toxic Cr(vi) ions present in aqueous medium. The MoS2 sheets showed excellent sensitivity towards Cr(vi) detection with a lower detection limit of 40.09 nM. Moreover, these 2D sheets also acted as an excellent photocatalyst because of their direct band gap of 1.90 eV, and were used for the reduction of inorganic toxic pollutant Cr(vi) ions to environmentally benign Cr(iii) ions under the irradiation of visible light. MoS2 sheets showed 98% photo reduction efficiency towards Cr(vi) ions within 20 min. Furthermore, the synthesized MoS2 sheets were successfully recycled up to five times without significant decrease of their photocatalytic reduction efficiency towards Cr(vi) ions. The present study demonstrates that metal free MoS2 sheets prepared by a simple solid state synthesis approach provide a simple, cost-effective and easy method for determination and removal of toxic Cr(vi) ions in aqueous medium.