The 1:1 complex of 8-hydroxyquinoline with squaric acid has been characterized using single-crystal X-ray diffraction, UV–vis spectroscopy, density functional theory (DFT) calculations, and photoluminescence, dielectric, piezoelectric and second-harmonic generation (SHG) studies. The title compound (8-hydroxyquinolinium hydrogen squarate; HQS) contains one protonated 8-hydroxyquinoline cation (C₉H₈NO⁺) and one hydrogen squarate mono-anion (C₄HO₄ ⁻). All the intermolecular hydrogen-bonding interactions present in the HQS crystal structure are analyzed by three-dimensional molecular Hirshfeld surface analysis and their relative contributions are determined from two-dimensional fingerprint plots. The structure of C₉H₈NO⁺·C₄HO₄ ⁻ molecular complex has been optimized at the DFT/B3LYP/6-31G(d,p) level. The UV–vis spectroscopic data calculated by time-dependent density functional theory are compared with the experimental data. The LUMO+1, LUMO, HOMO and HOMO−1 energy values, their shapes and energy gaps are calculated using the B3LYP/6-31G(d,p) level of theory. The HQS material exhibits high SHG output (2.6 times of that of potassium dihydrogen phosphate), high photoluminescence emission centred at 474 nm and a piezoelectric charge coefficient of 3 pC N⁻¹. Henceforth, HQS can serve as an alternative potential candidate for multifunctional nonlinear optically active and piezoelectric crystals.