Functionalized carbon nanotubes (f-CNTs), particularly CNTs decorated with nanoparticles (NPs), are of great interest because of their synergic effects, such as surface-enhanced Raman scattering, plasmonic resonance energy transfer, magnetoplasmonic, magnetoelectric, and magnetooptical effects. In general, research has focused on a single type of NP, such as a metal or metal oxide, that has been modified on a CNT surface. In this study, however, a new strategy is introduced for the decoration of two different NP types on CNTs. In order to improve the functionality of modified CNTs, we successfully prepared binary NP-decorated CNTs, namely, iron oxide/gold (Au) NP-decorated CNTs (IA-CNTs), which were created through two simple reactions in deionized water, without high temperature, high pressure, or harsh reducing agents. The physicochemical properties of IA-CNTs were characterized by ultraviolet/visible spectroscopy, Fourier transform infrared spectroscopy, a superconducting quantum interference device, scanning electron microscopy, and transmission electron microscopy. In this study, IA-CNTs were utilized to detect humidity. Magnetic IA-CNTs were aligned on interdigitated platinum electrodes under external magnetic fields to create a humidity-sensing channel, and its electrical conductivity was monitored. As the humidity increased, the electrical resistance of the sensor also increased. In comparison with various gases, for example, H-2, O-2, CO, CO2, SO2, and dry air, the IA-CNT-based humidity sensor exhibited high-selectivity performances. IA-CNTs also responded to heavy water (D2O), and it was established that the humidity detection mechanism had D2O-sensing capabilities. Further, the humidity from human out-breathing was also successfully detected by this system. In conclusion, these unique IA-CNTs exhibited potential application as gas detection materials.