Biphenylene network (BPN) structures have garnered attention owing to the presence of 4-, 6-, 8-, and 12membered rings in their unit cells, leading to unique properties. Additionally, the versatility of aluminum (Al) combined with group V elements, particularly nitrogen (N) atoms, presents promising applications across various domains. These factors have motivated us to investigate BPN-AlN structures containing 4-, 6-, and 12membered rings using density functional theory methods. These rings lead to large holes, making this structure useful for ion storage in energy storage materials. This study contains the stability (thermal, mechanical, and dynamical), structural, electronic, thermoelectric, and optical properties of the BPN-AlN nanosheet. The dynamic stability of the proposed BPN-AlN nanosheet was confirmed by the absence of negative modes in the phonon dispersion spectrum. Furthermore, minimal energy fluctuations in the ab initio molecular dynamics simulation, even at a high temperature of 1500 K, prove the thermal stability of the BPN-AlN nanosheet. This calculation leads to the BPN-AlN nanosheet's high melting temperature. The BPN-AlN nanosheet has exhibited semiconductor behavior with a high indirect band gap of 4.025 eV. By investigating the electron localization function, the BPN-AlN nanosheet shows polar ionic bonds, which introduces this nanosheet as a good candidate for absorbing numerous polar substances like sensors. The Seebeck coefficient exhibits the highest peak values of 359 μV/K (n-type) and 305 μV/K (p-type) at 300 K. Additionally, the ultralow lattice thermal conductivity, approximately 0.46 W/mK at 300 K, confirms the superior thermoelectric properties of BPN-AlN nanosheets. The study of the optical properties of the BPN-AlN nanosheet reveals significant absorption and minimal reflection of ultraviolet light, highlighting the potential of the BPN-AlN nanosheet for applications in ultraviolet protection. The specific electronic and optical properties imply that the BPB-AlN nanosheet may be used in the generation of nano-optoelectronic technology design.