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Abstract Background Changing climate enhances the survival of pests and pathogens, which eventually affects crop yield and reduces its economic value. Novel approaches should be employed to ensure sustainable food security. Nano-based agri-chemicals provide a distinctive mechanism to increase productivity and manage phytopathogens, with minimal environmental distress. In vitro and in greenhouse studies were conducted to evaluate the potential of green-synthesized iron-oxide nanoparticles (IONPs) in suppressing wilt infection caused by Fusarium oxysporum f. sp. lycospersici, and improving tomato growth (Solanum lycopersicum) and fruit quality. Results Various microwave powers (100–1000 W) were used to modulate the properties of the green-synthesized IONPs, using spinach as a starting material. The IONPs stabilized with black coffee extract were substantively characterized using X-ray diffraction analysis (XRD), Fourier-transform infrared spectroscopy, dielectric and impedance spectroscopy, X-ray photoelectron spectroscopy (XPS), scanning and transmission electron microscopy (SEM and TEM, respectively), and magnetization analysis. XRD revealed a cubic magnetite (Fe3O4) phase with super-paramagnetic nature, detected at all microwave powers. The binding energies of Fe 2p3/2 (710.9 eV) and Fe 2p1/2 (724.5 eV) of Fe3O4 NPs were confirmed using XPS analysis at a microwave power of 1000 W. Uniform, spherical/cubical-shaped particles with an average diameter of 4 nm were confirmed using SEM and TEM analysis. A significant reduction in mycelial growth and spore germination was observed upon exposure to different IONP treatments. Malformed mycelium, DNA fragmentation, alternation in the cell membrane, and ROS production in F. oxysporum indicated the anti-microbial potential of the IONPs. The particles were applied both through the root (before transplantation) and by means of foliar application (after two weeks) to the infected seedlings. IONPs significantly reduced disease severity by an average of 47.8%, resulting in increased plant growth variables after exposure to 12.5 µg/mL of IONPs. Analysis of photosynthetic pigments, phenolic compounds, and anti-oxidant enzymes in the roots and shoots showed an increasing trend after exposure to various concentrations of IONPs. Correspondingly, lycopene, vitamin C, total flavonoids, and protein content were substantially improved in tomato fruits after treatment with IONPs. Conclusion The findings of the current investigation suggested that the synthesized IONPs display anti-fungal and nutritional properties that can help to manage Fusarium wilt disease, resulting in enhanced plant growth and fruit quality. Graphical Abstract