This study presents the fabrication of a sustainable flexible humidity sensor utilizing chitosan derived from mealworm biomass as the primary sensing material. The chitosan-based humidity sensor was fabricated by casting chitosan and polyvinyl alcohol (PVA) films with interdigitated copper electrodes, forming a laminate composite suitable for real-time, resistive-type humidity detection. Comprehensive characterization of the chitosan film was performed using Fourier-transform infrared (FTIR) spectroscopy, contact angle measurements, and tensile testing, which confirmed its chemical structure, wettability, and mechanical stability. The developed sensor exhibited a broad range of measurements from 6% to 97% relative humidity (RH), a high sensitivity of 2.43 kΩ/%RH, and a rapid response time of 18.22 s with a corresponding recovery time of 22.39 s. Moreover, the chitosan-based humidity sensor also demonstrated high selectivity for water vapor when tested against various volatile organic compounds (VOCs). The superior performance of the sensor is attributed to the structural properties of chitosan, particularly its ability to form reversible hydrogen bonds with water molecules. This mechanism was further elucidated through molecular dynamics simulations, revealing that the conductivity in the sensor is modulated by proton mobility, which operates via the Grotthuss mechanism under high-humidity and the packed-acid mechanism under low-humidity conditions. Additionally, the chitosan-based humidity sensor was further seamlessly integrated into an Internet of Things (IoT) framework, enabling wireless humidity monitoring and real-time data visualization on a mobile device. Comparative analysis with existing polymer-based resistive-type sensors further highlighted the superior sensing range, rapid dynamic response, and environmental sustainability of the developed sensor. This eco-friendly, biomass-derived, eco-friendly sensor shows potential for applications in environmental monitoring, smart agriculture, and industrial process control.