Urea is a common milk adulterant that falsely increases its protein content. Excessive consumption of urea is harmful to the kidney, liver, and gastrointestinal system. The conventional methods for urea detection in milk are time-consuming, costly, and require highly skilled operators. So, there is an increasing demand for the development of rapid, convenient, and cost-efficient methods for the detection of urea adulteration in milk. Herein, we report a novel colorimetric paper-based urea biosensor, consisting of a novel environment-friendly nanocomposite of halloysite nanotubes (HNT), that urease enzyme and an anthocyanin-rich extract, as a natural pH indicator are simultaneously immobilized into its internal and external surfaces. The biosensing mechanism of this biosensor is based on anthocyanin color change, which occurs due to urease-mediated hydrolysis of urea and pH increment of the environment. The colorimetric signal of this biosensor is measured through smartphone-assisted analysis of the mean RGB (Red-Green-Blue) intensity of samples and is capable of detecting urea with a detection limit of 0.2 mM, and a linear range from 0.5 to 100 mM. This biosensor has demonstrated promising results for the detection of urea in milk samples, in the presence of other milk adulterants and interferents.