Monitoring and assessing toxic materials which are being released into the environment along with wastewater is a growing concern in many industries. The current research describes a highly sensitive and rapid method for the detection of toxic concentrations of heavy metals in aquatic environments. Water samples were collected from southern coasts of the Caspian Sea followed by screening of luminescent bacteria. Phylogenetic analysis, including gene sequence of 16S rRNA, and biochemical tests were performed for identification of the isolate. Luminescence activity was tested and measured after treatment of the isolate with different concentrations of heavy metals and reported as EC50 value for each metal. A luminous, gram negative bacterium with the shape of a curved rod was isolated from the Caspian Sea. Biochemical tests and 16S rRNA gene sequence analysis indicated that the isolate MM1 had more than 99% similarity to Vibrio campbellii. The novel isolate is able to emit high levels of light. Bioluminescence inhibitory assay showed that the Vibrio sp. MM1 had the highest sensitivity to zinc and the lowest sensitivity to cadmium; EC50 values were 0.97 mg l−1 and 14.54 mg l−1, respectively. The current research shows that even low concentrations of heavy metals can cause a detectable decline in luminescence activity of the novel bacterium Vibrio sp. MM1; hence, it makes a good choice for commercial kits for the purpose of monitoring toxic materials.