We have demonstrated a novel sensing strategy employing a giant magnetoresistance (GMR) biosensor and DNA chemistry for the detection of mercuric ion (Hg2+). This assay takes advantages of high sensitivity and real-time signal readout of GMR biosensor and high selectivity of thymine-thymine (T-T) pair for Hg2+. The assay has a detection limit of 10 nM in both buffer and natural water, which is the maximum mercury level in drinking water regulated by U.S. Environmental Protection Agency (EPA). The magnitude of the dynamic range for Hg2+ detection is up to three orders (10 nM to 10 μM). Herein, GMR sensing technology is first introduced into a pollutant monitoring area. It can be foreseen that the GMR biosensor could become a robust contender in the areas of environmental monitoring and food safety testing.