Gas sensors based on metal oxide semiconductors (MOSCs) and reduced graphene oxide (rGO) for sensing of organic volatile compounds often suffer from high operation temperature, low responses, poor selectivity, or narrow detection range. Herein, we design and fabricate Bi-doped rGO/Co3O4 (BGCO) nanohybrids with a flower morphology, which have been applied as a sensing layer for an ethanol sensor. This BGCO sensor exhibits a maximum p-type response of 178.1 towards 500 ppm ethanol at an optimum working temperature of 120 °C. The sensor’s detection range for the ethanol concentration is from 500 ppb to 500 ppm, and the sensor has an excellent selectivity to ethanol compared to other types of organic volatile gases and oxidizing gas such as NO2. The enhanced ethanol sensing mechanism is attributed to the increased conductivity of Bi doped rGO/Co3O4 material. Additionally, incorporation of Bi dopant can promote the redox reaction, and the rGO/Co3O4 act as the catalyst.