A new blended material, m-CNTs/NaClO4/Ppy, was developed as a gas sensor to detect ethanol concentrations at room temperature. The sensing material polypyrrole (Ppy) was synthesized in situ by UV-photo-polymerization. The multiwall carbon nanotubes (m-CNTs) added enhanced the short-term repeatability of the Ppy-sensing material. The relative resistance variation (Rethanol/Rair) of m-CNTs/NaClO4/Ppy was 1.193 when exposed to ethanol of 30,000 ppm. The sensor response and recovery times (both 20 s) were very short to this concentration. An unstable baseline of the sensor was explained by theoretical calculation of molecular dynamics made for ethanol adsorption on polypyrrole, which revealed formation of a new bond, N-H⋯O. Adsorption energy decreased with increasing the number of ethanol molecules adsorbed and was 0.8 kcal/mol at eight adsorbed molecules. Sensor responses of three different Ppy samples were measured to ethanol concentrations of 18,000-40,000 ppm.