This work highlights the preparation of the novel CeO2@MnFe2O4/NaY nanocomposite catalyst by the hydrothermal method for the decontamination of sulfur mustard agent simulant 2-chloroethyl phenyl sulfide (2-CEPS). The as-prepared nanocomposite was identified via FESEM-EDAX, XRD, FTIR, VSM, and N2-BET analyses. The decontamination of 2-CEPS was then monitored using the GC-FID analysis. Moreover, the impacts of several parameters such as contact time, catalyst type, catalyst amount, and solvent type on the decontamination efficiency of 2-CEPS were evaluated. By utilizing 40 mg of the CeO2@MnFe2O4/NaY catalyst in the presence of n-decane nonpolar solvent, a decontamination efficiency of 97.4% was achieved after contact time of 60 min. Also, the decontamination reactions rate was validated applying a first-order kinetic model. Eventually, the presence of elimination and hydrolysis products, involving phenyl vinyl sulfide (PVS) and 2-hydroxy ethyl phenyl sulfide (2-HEPS) from the degradation of 2-CEPS on the CeO2@MnFe2O4/NaY catalyst were clearly proved and GC-MS analysis was applied to recognize the degradation products of 2-CEPS. This revealed that the CeO2@MnFe2O4/NaY catalyst could potentially be used for the decontamination of toxic chemical agents.