This study addresses the challenge of solid waste management in the leather industry, particularly focusing on vegetable-tanned leather trimming dusts, which are often underutilized. Instead of traditional applications such as fish/poultry feed or cosmetics, this research proposes an innovative approach to repurpose this waste material by incorporating green zinc oxide nanoparticles (ZnO NPs) to produce antibacterial shoe insoles. ZnO NPs were synthesized using the chemical co-precipitation method and the plant-mediated synthesis method with banana peel extract. The nanoparticles were integrated into vegetable-tanned leather trimming dust and latex-based biocomposites optimized with the multi-criteria decision-making weighted sum model (MCDM–WSM). Through comprehensive characterization techniques, including FTIR, XRD, FESEM, EDX, DLS, and thermal analysis, the successful incorporation of nano-sized ZnO was confirmed, demonstrating diameters ranging from 65 to 91 nm and uniform distribution within the composite matrix. The composite showed enhanced mechanical properties, with tensile strength ranging from 11.6 ± 0.6 to 13.5 ± 0.2 MPa, a flexing index of approximately 3.95, and a stitch tear strength between 845 and 867 N/mm, which are comparable to the mechanical properties of a shoe insole. Antibacterial testing further revealed significant inhibition of Bacillus subtilis and Escherichia coli growth. These findings emphasize the potential of the composite as a viable alternative to conventional insoles, offering enhanced antibacterial benefits.