In this work, a novel pH sensitive calcium phosphate (CaP) nanocomposite capable of performing multiple tasks of controlled drug delivery, and simultaneous sensing by change in the fluorescence was fabricated. The nanocomposite was synthesized by encapsulating alendronate (AD) drug in CaP and modifying the surface with a fluorescent rhodamine B (RDB) dye. The multifunctional nanocomposite demonstrated high loading capacity for AD, excellent pH-tunable AD release and optical sensing behavior, and good aqueous dispersity. Analysis by transmission electron microscopy and dynamic light scattering analysis revealed that RDB modified CaP/AD (RDB-CaP/AD) nanocomposite had average dimensions of 21 nm × 44 nm and mean hydrodynamic size of 55 nm. The feasibility of CaP/AD nanocomposite for controlled drug delivery by pH responsive release was demonstrated by in vitro study at two different pH, 5.0 and 7.4. Furthermore, CaP/AD loaded with fluorescent RDB showed pH tunable fluorescence property, which can help in tracking the active state of the particle and give measurable indication of the drug delivery. In vitro study with osteoclast precursor cells, RAW 264.7 confirmed that CaP/AD nanocomposite significantly reduced the activity of osteoclast cells. The present study demonstrates that the fabricated multifunctional RDB-CaP/AD nanocomposites can serve as an effective drug delivery vehicle capable of controlled drug release and sensing, simultaneously.