This study explores the enhancement of room-temperature trace NO₂ sensing performance by tailoring the thickness and functionalization of MXene. Sub-100 nm MXene flakes are synthesized using a hybrid method involving high-pressure processing, stirring, and immiscible solutions. The functionalization is achieved through defunctionalization at 650 °C under vacuum and H₂ gas, followed by refunctionalization with iodine and bromine vapor. Iodine, with its larger atomic size, lower electronegativity, and reduced shielding effect, significantly improves the surface area, oxidation stability, and conductivity of I-MXene. These enhancements lead to improved gas-sensing performance, including higher sensitivity (0.1119 Ω ppm⁻¹), response (0.2% and 23% to 50 ppb and 200 ppm NO₂), and response/recovery times (90/100 s). The reduced shielding effect of –I-terminals and the metallic nature of MXene enhance the selectivity of I-MXene toward NO₂. This research paves the way for the development of stable and high-performance gas-sensing two-dimensional materials.This study explores the enhancement of room-temperature trace NO₂ sensing performance by tailoring the thickness and functionalization of MXene. Sub-100 nm MXene flakes are synthesized using a hybrid method involving high-pressure processing, stirring, and immiscible solutions. The functionalization is achieved through defunctionalization at 650 °C under vacuum and H₂ gas, followed by refunctionalization with iodine and bromine vapor. Iodine, with its larger atomic size, lower electronegativity, and reduced shielding effect, significantly improves the surface area, oxidation stability, and conductivity of I-MXene. These enhancements lead to improved gas-sensing performance, including higher sensitivity (0.1119 Ω ppm⁻¹), response (0.2% and 23% to 50 ppb and 200 ppm NO₂), and response/recovery times (90/100 s). The reduced shielding effect of –I-terminals and the metallic nature of MXene enhance the selectivity of I-MXene toward NO₂. This research paves the way for the development of stable and high-performance gas-sensing two-dimensional materials.