Formaldehyde (HCHO) is the main source of indoor air pollutant. HCHO sensors are therefore of paramount importance for timely detection in daily life. However, existing sensors do not meet the stringent performance targets, while deactivation due to sensing detection at room temperature, for example, at extremely low concentration of formaldehyde (especially lower than 0.08 ppm), is a widely unsolved problem. Herein, we present the Ag nanoparticles (Ag NPs) sensitized dispersed InO nanograin via a low-fabrication-cost hydrothermal strategy, where the Ag NPs reduces the apparent activation energy for HCHO transporting into and out of the InO nanoparticles, while low concentrations detection at low working temperature is realized. The pristine InO exhibits a sluggish response (R/R = 4.14 to 10 ppm) with incomplete recovery to HCHO gas. After Ag functionalization, the 5%Ag-InO sensor shows a dramatically enhanced response (135) with a short response time (102 s) and recovery time (157 s) to 1 ppm HCHO gas at 30 °C, which benefits from the Ag NPs that electronically and chemically sensitize the crystal InO nanograin, greatly enhancing the selectivity and sensitivity.