Doping of zinc oxide (ZnO) with manganese (Mn) tunes midbandgap states of ZnO to enhance its optical properties and makes it into an efficient photoactive material for photoelectrochemical water splitting, waste removal from water, and other applications. We demonstrate that ZnO modified with 1 at. % Mn exhibits the best performance, as rationalized by experimental, structural, and optical characterization and theoretical analysis. ZnO doped with the optimal Mn content possesses improved light absorption in the visible region and minimizes charge carrier recombination. The doping is substitutional and creates midgap states near the valence band. Mn atoms break localized charge traps at oxygen vacancy sites and eliminate photoluminescence peaks associated with oxygen vacancies. The optimal performance of Mn-modified ZnO is demonstrated with the photodegradation of Congo red and photoelectrochemical water splitting.