To detect low concentrations of formaldehyde selectively, the sensing properties of SnO2 nanostructured are enhanced by modifying with p-type semiconductor NiO. In this study, a nanostructured SnO2/NiO composite was prepared by a simple hydrothermal method. The X-ray photoelectron spectroscopy (XPS) peak in 532.4 eV proved that the existence of the SnO2/NiO composite structure increased the amount of adsorbed oxygen O− and O2− significantly. Gas-sensing tests showed that these mixed phases SnO2/NiO are highly promising for gas sensor applications, as the gas response for formaldehyde was significantly enhanced in gas response, selectivity at an operating temperature of 230 °C. The sensor fabricated by SnO2/NiO composite can detect as low as 1 ppm of formaldehyde at 230 °C, and the corresponding response is 1.57. The results of physicochemical properties tests of the samples show that the enhancement in sensitivity and selectivity is attributed to the oxygen vacancies and heterojunction between SnO2 and NiO. The SnO2/NiO composites can be applied to sensitive materials of formaldehyde sensors.