Red mud (RM), an industrial waste derived from aluminum production, is a significant environmental concern due to its high alkalinity and large volumes. However, RM can be leveraged in the construction industry for wide variety of applications, including production of low-carbon cementitious materials and for environmental remediation. Using RM as a cement replacement reduces the need for raw materials typically used in cement production, such as limestone and clay. This helps conserve natural resources and reduces the environmental impact of mining. At the same time, it addresses other environmental concerns simultaneously by reducing waste and potentially lowering the carbon footprint of construction industry. This study explores the photocatalytic performance of RM, and its subsequent use in cementitious materials as partial cement replacement. Red mud is rich in iron oxide, which is distributed in mineral phases such as hematite (Fe2O3) and goethite (FeOOH). Hematite (α-Fe2O3) is the most stable form of iron oxide and can be significant for photocatalytic applications point of view. In the initial phase of this study, the photocatalytic activity of RM was assessed by means of an abatement test to measure NOx reduction in solar irradiation. It was observed that RM has a potential of photocatalytic removal of nitrogen oxides, attributed to the adsorption of NO and NOx, as well as their subsequent photocatalytic degradation. In second stage of the study, RM-based cement mortars were prepared, and based on variables i.e., RM’s substitution levels as cement replacement, workability and compressive strength of mortars were investigated. The thermal properties and phase transitions of the investigated mortars were studied using thermogravimetric analysis (TGA). The compressive strength of RM-cement mortar at 28 days with optimal conditions (5% RM substitution) i.e., C3R5 is 31.19 MPa, showing 41% improvement over standard cement mortar. Scanning electron microscope (SEM) micrographs reveal abundant hydration products and strong interfaces in C3R5. By offering an environmentally friendly solution to RM management while simultaneously creating useful construction materials, this study represents a significant step towards more sustainable industrial practices and resource utilization.