Molybdenum disulfide (MoS2), a notable two-dimensional (2D) material, has attracted considerable interest for its potential applications in gas sensing, despite its typically insulating characteristics, which have limited its practical use. In this study, we present the use of mixed phase MoS2 (1T@2H-MoS2) to overcome sensing limitations of MoS2 material by enhancing its conductivity and demonstrating its high-performance characteristics for sensing ammonia (NH3) at room temperature (20 °C). The 1T@2H-MoS2 was synthesized via a hydrothermal process, and the coexistence of two different phases (the 1T and 2H phases) was confirmed by transmission electron microscopy (TEM), X-ray photoelectron spectroscopy (XPS), X-ray diffraction (XRD), and Raman spectroscopy. The flower-like morphology was confirmed by field emission scanning electron microscopy (FESEM) and TEM. Our results indicate that the presence of both 1T and 2H phases within the material introduces sulfur vacancies, which we propose are critical to significantly enhancing its sensitivity to NH3 gas. The ammonia-sensing performance of the 1T@2H-MoS2 material was evaluated, and it demonstrated rapid and selective detection of NH3 gas across a wide concentration range (2 ppm to 100 ppm), with a very swift response time (7 s), fast recovery and high selectivity at room temperature without requiring heating. This improvement is attributed to the increased conductivity and effective active sites provided by the sulfur defects. This study underscores the potential of mixed-phase MoS2 in developing rapidly responsive and highly selective NH3 sensors, paving the way for the safety monitoring of hazardous gases in various industrial settings.