Luminescent cysteamine-modified nanodiamond particles (ND-Cys) have been reported in surface-mediated energy transfer, cell imaging, and metal-ion recognition studies. In normalized photoluminescence (PL) spectral studies, the emission maxima of ND-Cys (at 50 mu g/mL in water) was fixed at 438 nm at 350 nm excitation, producing a blue emission with a quantum yield (Phi) of 0.13. In the dispersion range of 0-800 mu g/mL, ND-Cys exhibited agglomeration-induced energy transfer via red shifting of the PL peak from 438 nm to 451 nm. Analogous to PL studies, Raman interrogations also established the agglomeration and fixed the saturation limit to 500 mu g/mL in water. The low toxicity and biocompatibility of ND-Cys were demonstrated using methyl thiazolyl tetrazolium assay and time-dependent HeLa cell imaging. Subsequently, the Hg2+ selectivity by ND-Cys was revealed by an intense fluorescence peak shift from 440 nm to 463 nm. Fluorescence studies indicated that the detection limit of Hg2+ ions approximated 153 nM. Fourier-transform infrared and X-ray photoelectron spectroscopy (XPS) analyses supported the binding between free thiol (-SH) and amide (-C=O and -NH) groups of ND-Cys to Hg2+. The Hg2+-induced agglomeration and surface graphitization were successfully confirmed by X-ray powder diffraction, XPS, Raman, scanning electron microscopy, transmission electron microscopy, dynamic light scattering, and zeta potential analyses. Effective detection of Hg2+ ions by ND-Cys was validated through HeLa cell imaging at shortened time intervals.